Grayscale Investments, one of the first spot Bitcoin ETF issuers, has hit a major milestone for its product today. According to data shared by Investment management firm Farside Investors, Grayscale bagged $63 million in inflow.
Grayscale Ends Outflow Streak
The Michael Sonnenshein-led company has been bleeding out as investors holding its Grayscale Bitcoin Trust (GBTC) pivoted. Of the 11 ETFs approved by the United States Securities and Exchange Commission (SEC), only Grayscale has been experiencing intense fund outflows.
Market analysts did not see this massive turnaround after about 80 days of operation. The losing streak was so massive and consistent that no market analyst placed a bet on when the outflow would stop.
Holy crap $GBTC had inflows today. Their 80 day-ish streak is finally over. I had to run my eyes and double check the data but it’s true. https://t.co/I4TTU4q5Q1
— Eric Balchunas (@EricBalchunas) May 3, 2024
The spot Bitcoin ETF market has remained competitive in recent times. Notably, major banking giants like BNP Paribas and Morgan Stanley are even making their emergence into the industry. However, BlackRock is the favored issue for these two banks.
Grayscale’s woes were hinged on its sponsor fee which unlike its peers comes in at 1.5%. The company’s executives have justified this huge fee with talks about the legacy of GBTC and its experience in administering profitable ETFs.
Grayscale played a major role in getting spot Bitcoin ETF approval. After its GBTC conversion bid was denied by the markets regularly, Grayscale sued the SEC and eventually won.
Spot Bitcoin ETF Is Evolving
Spot Bitcoin ETF products are evolving at a very fast pace with expansion to new regions. The products are now trading in Hong Kong, however, trading volumes have been generally low, compared to the US offerings.
Besides Hong Kong, the Australian ASX Stock Exchange (ASX) is also planning to list the products by the end of 2024. With the turnaround in Grayscale’s GBTC, the prospect that these Bitcoin ETF products will succeed eventually is high.
