BlackRock’s Bitcoin ETF Holds 3.25% of Total Supply

BlackRock’s spot Bitcoin exchange-traded fund (ETF) has amassed over $69.7 billion worth of Bitcoin (BTC), representing over 3.25% of the total BTC supply. This significant acquisition underscores the growing interest from institutional investors in the cryptocurrency market, even as retail inflows appear to be slowing down. BlackRock, the world’s largest asset manager, has seen its iShares Bitcoin Trust (IBIT) ETF control over 54.7% of the market share of all US spot Bitcoin ETFs, which collectively hold 6.12% of the total 21 million Bitcoin supply.

This milestone comes less than a year and a half after US spot Bitcoin ETFs first debuted for trading on Jan. 11, 2024. The sustained inflows into the ETF market have been notable, with US Bitcoin ETFs logging eight consecutive days of net positive flows, bringing in $388 million in Bitcoin on Wednesday alone. IBIT has also entered the world’s top 25 largest ETFs by assets under management, ranking as the 23rd largest ETF among crypto and traditional finance products.

Despite the impressive growth, some analysts suggest that the demand for ETFs is being offset by profit-taking and selling pressure from miners. Iliya Kalchev, an analyst, noted that a breakout may need a new catalyst or sentiment shift. He added that long-dormant wallets are currently absorbing more supply than miners are producing, and that corporate treasury strategies and accumulation from large investors continue to offset profit-taking.

Onchain data indicates that large-value transfers are dominating Bitcoin network activity. Although the total number of transactions has declined, the average transaction size is now $36,200. This trend implies that larger entities continue to utilize the Bitcoin network, with the throughput per transaction rising even as overall activity by count declines. Transactions exceeding $100,000 now account for over 89% of network activity, reinforcing the view that high-value participants are becoming increasingly dominant.

While large players accumulate, fewer new retail investors appear to be entering the market. Bitcoin’s short-term holder cohort has fallen to just 4.5 million BTC, down over 800,000 BTC from holding 5.3 million BTC on May 27, signaling that “new money is drying up in Bitcoin.” If investor demand continues to weaken, Bitcoin may find its next significant support near the $92,000 mark, which is the traders’ onchain realized price that acts as a significant support level during bull cycles.