ProShares Bitcoin ETF BITO Attracts Quarter-Billion Flows in a Month
The ProShares Bitcoin Strategy ETF (BITO) – the largest existing Bitcoin ETF in the United States – has absorbed a quarter of a billion dollars worth of flows over the past month, marking the fund’s second-best-performing month since its launch. This signals fierce anticipation over an incoming spot ETF approval.
Revival of Futures ETFs
Bloomberg ETF analyst Eric Balchunas noted the value of BITO’s assets nearly doubled over the last 30 days from ~$850 million in early October to $1.37 billion as of November 10. While most of that appreciation was due to Bitcoin (BTC)’s surging price over that period, about $240 million worth of growth was due to concrete inflows. The predicted added that the fund may be on track to break its trading volume record, with $2 billion worth of trades this week alone.
“It’s all so ironic that it is [a] big benefactor of spot ETF anticipation but will be one of the big victims of said spot ETFs when they launch,” wrote Balchunas.
Upon the fund’s launch in October 2021, BITO absorbed $1 billion worth of inflows in just two days, marking the second-largest opening day in the history of the New York Stock Exchange (NYSE).
Seeking Bitcoin Exposure
BITO was the first Bitcoin ETF to reach the United States, but it invests in Bitcoin futures contracts rather than actual BTC. As such, the fund’s shares do not perfectly track Bitcoin’s price like a spot-based ETF would. Analysts are expecting a likely ETF approval by early January, as mounting public pressure and a recent court defeat to Grayscale surrounding its spot Bitcoin ETF application has raised hopes for approval. Until then, BITO remains a popular tool for institutions seeking BTC exposure if they must invest in the asset through the wrapper of an equity or an ETF.
Rival stocks that are popular for institutional BTC exposure include Coinbase (COIN) and MicroStrategy (MSTR), alongside Bitcoin mining stocks like Marathon Digital (MARA). Bitcoin funds have attracted major inflows over the past month, racking up $229 million. Though BTC remains the dominant asset for institutional fund flows, Ether (ETH) related funds have also absorbed $17.5 million.
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