Bloomberg ETF analyst Eric Balchunas noted that U.S. market risk ETFs were impacted by "a massive influx of funds spurred by Trump." Bitcoin and cryptocurrency ETFs did not lead this rally, but their gains are still substantial.
A reduction in federal interest rates could lead to bearish sentiment for risk assets, but cryptocurrency ETFs have a special advantage.
Risk-tolerant ETFs achieve great success
According to Bloomberg ETF analyst Eric Balchunas, the performance of risk-tolerant ETF assets on Thursday exceeded everyone's expectations. The cryptocurrency market has been thriving since Donald Trump won the recent U.S. presidential election. However, recent trading data indicates that risk-tolerant ETFs have also seen record capital flows, even in sectors unrelated to the industry.
"Capital Battle: A massive influx of funds spurred by Trump into risk ETFs. An inflow of $22 billion in a single day is just outrageous; typically, the inflow for this week is quite good. Year-to-date net inflows have exceeded $856 billion (just $55 billion short of the annual record), with inflows exceeding $1 trillion for the consecutive year," Balchunas stated in a social media post.
Balchunas cites ETF analyst Todd Sohn, who describes this as a "post-election release valve." Surprisingly, Bitcoin ETFs did not appear on this list of biggest winners. However, they still belong to the risk asset category and have independently shown very bullish signs.
Take the best-performing Bitcoin ETF, BlackRock's IBIT, as an example. The value of these ETFs had already skyrocketed before the election, and on Thursday, IBIT saw an inflow of $1.12 billion in a single day. Overall, the inflow for spot Bitcoin ETFs on Thursday was $1.38 billion.
Other risk-tolerant ETFs related to cryptocurrencies also achieved similar victories, even if they were not rated as the best-performing ETFs. For example, the 2x Coinbase ETF CONL rose by 62% in one day.
Balchunas stated that this is close to the historical highest record for a single-day percentage increase in ETFs. Such smaller increases indicate a stronger bullish trend for the entire asset class.
