Bitcoin ETFs Attract $1.8 Billion Inflows, Outpacing Gold and Ethereum

U.S.-based Bitcoin ETFs attracted over $1.8 billion in inflows last week, extending a positive run that began on April 17. This influx of capital highlights the growing interest and investment in Bitcoin-related financial products. The inflows were particularly strong on Thursday and Friday, with these two days bringing in $423 million and $675 million, respectively. Friday’s total was the seventh-highest of the year, underscoring the significant momentum behind Bitcoin ETFs.

The data also reveals that Bitcoin ETF inflows outstripped their Ethereum counterparts by a factor of more than 10:1. This disparity suggests that investors are favoring Bitcoin over other cryptocurrencies in their ETF investments. BlackRock’s iShares ETF was a standout performer, with a total of $2.56 billion in net flows. In contrast, several rivals suffered significant outflows, with the Ark 21Shares Bitcoin ETF shrinking by $458 million.

This trend of strong flows for Bitcoin ETFs coincides with outflows from gold ETFs, as investors increasingly turn to Bitcoin as a hedge against U.S.-based assets. Between April 28 and May 2, gold ETFs saw a total outflow of $1,941 billion, creating a $3.7 billion gap between flows for Bitcoin and gold ETFs. This gap is similar to the $4 billion difference witnessed in the previous week, indicating a clear shift in investor preferences.

Speaking on a panel at a recent event, BlackRock’s Robert Mitchnick noted that Bitcoin ETF flows “are back in a big way.” He highlighted that institutions and advisory firms are accounting for an increasingly large share of total BTC ETF flows, whereas high-net-worth individuals were more predominant when ETFs first launched. This shift suggests that the institutional investment community is becoming more comfortable with Bitcoin as an asset class.

Mitchnick also suggested that the attraction of Bitcoin ETFs is tied to how BTC has been increasingly behaving like a safe haven, or a hedge that’s not correlated to the monetary risks arising from any particular country. This notion is supported by the recent performance of Bitcoin, which has been profiting at the expense of U.S. government bonds and gold. The BTC dominance ratio currently sits at its highest level in four years, as major altcoins such as Ethereum, Solana, and Dogecoin remain well below highs recorded in January.

The possible approval of ETFs for other cryptocurrencies later in the year may help rectify this imbalance. However, the recent experience of Ethereum, which already has active ETFs in the U.S., suggests that Bitcoin may continue to dominate. As noted, Bitcoin ETF inflows far outstripped those for Ethereum ETFs last week, with the latter attracting a relatively modest $149.2 million in net flows. This disparity underscores the continued strength and appeal of Bitcoin in the ETF market.