Will Bitcoin Futures ETFs Crumble After Spot ETF Approval? Interview With ProShares
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As Bitcoin (BTC) surged passed $38,000 in November, the ProShares Bitcoin Strategy ETF (BITO) has tapped a new all-time high for assets under management (AUM).
On Tuesday, the fund’s Bitcoin futures contracts reached a record $1.47 billion in value. That’s up from $1.1 billion at the start of the month, and $544 million at the start of the year.
“The flows have been really strong,” said Simeon Hyman, Global Investment Strategist at ProShares, to CryptoNews in an interview. “It hasn’t all been [BTC] appreciation, there have been very strong inflows.”
As of November 30, BITO has absorbed $470.9 million in net flows year-to-date. It’s also averaged $160 million in daily trading volume, putting it in the top 5% of all U.S. ETFs.
November was one of the fund’s best-performing months aside from its inception in October 2021, when it became the first Bitcoin ETF to launch in the United States. It marked its previous all-time high AUM at $1.44 billion just weeks later on November 10, when BTC itself reached its all-time high of $69,000.
Ironically, both BTC and BITO’s stellar performance has been largely driven by growing excitement for a U.S. Bitcoin spot ETF – a theoretical competitor to BITO in the arena of institutional Bitcoin investment options.As of Friday, Bloomberg ETF analysts expect a simultaneous approval of several ETFs from BlackRock, Ark, Fidelity, and others in early JanuaryUnlike BITO, a spot ETF would back its respective shares with actual BTC rather than futures contracts, allowing for a more direct form of exposure.
According to Hyman, BITO’s total return for investors is 115% year-to-date. By comparison, shares for the Purpose Bitcoin CAD ETF – a Bitcoin spot ETF in Canada – are up 127% this year, while BTC itself has risen 133%.