Fund Managers Boost Exposure to Bitcoin ETFs, Quarterly US Filings Show

In the first quarter of 2024, fund managers in the United States significantly increased their exposure to Bitcoin exchange-traded funds (ETFs), according to recent filings. This trend aligns with the broader market trends and investor sentiment, as the U.S. Securities and Exchange Commission (SEC) approved 11 spot Bitcoin ETFs in February 2025, marking a significant milestone for the cryptocurrency market.

The approval of spot Bitcoin ETFs allowed investors to gain direct exposure to Bitcoin through a regulated product, making it more accessible and convenient for both retail and institutional investors. This development drew new investors into the market and increased the demand for Bitcoin ETFs. The growing institutional interest in cryptocurrencies, driven by the desire to diversify investments, hedge against inflation, and capitalize on the potential growth of the digital asset class, further fueled this trend.

Millennium Management, a prominent hedge fund, disclosed a 2.5% allocation to Bitcoin in its portfolio, worth $1.69 billion. This allocation indicates a desire to diversify their portfolios and hedge against traditional market risks. Similarly, Schonfeld Strategic Advisors invested $479 million in spot Bitcoin ETFs, with the majority allocated to BlackRock's iShares Bitcoin Trust (IBIT) and Fidelity's FBTC (Fintel, 2024).

The growing interest in Bitcoin ETFs by fund managers significantly influences the overall demand for Bitcoin and its price dynamics, both in the short and long term. The approval of spot Bitcoin ETFs has drawn new retail and institutional investors into the market, providing a more accessible and convenient way to invest in Bitcoin. This increased demand has led to a surge in the price of Bitcoin. For instance, on the day of the SEC's approval, Bitcoin's price rose by 3% to around $47,000, well below its November 2021 peak of $69,000 but nearly three times the December 2022 trough of $16,000 (Financial Times, 2025).

In the long term, the growing institutional interest in Bitcoin ETFs is expected to further fuel this trend, as more fund managers allocate a portion of their portfolios to these investment vehicles. This increased demand from institutional investors is likely to drive up Bitcoin's price and market capitalization. The increased competition among fund managers is likely to drive further investment in Bitcoin ETFs, leading to a sustained increase in demand for Bitcoin and its price.

In conclusion, the growing interest in Bitcoin ETFs by fund managers significantly influences the overall demand for Bitcoin and its price dynamics, both in the short and long term. The approval of spot Bitcoin ETFs has drawn new investors into the market, leading to a surge in Bitcoin's price, and the growing institutional interest is expected to drive further investment in these ETFs, resulting in a sustained increase in demand for Bitcoin and its price.