The second quarter of 2024 recorded massive institutional interest in Bitcoin, as a significant portion of asset managers either held steady or increased their exposure to Bitcoin through the U.S.-based spot exchange-traded funds (ETFs). This resilience comes despite a notable decline in Bitcoin’s value during the same period.

According to data shared by Bitwise, a leading digital asset management firm, approximately 66% of institutional investors either maintained or increased their Bitcoin holdings via spot ETFs in Q2. This data, drawn from the 13F filings submitted to the U.S. Securities and Exchange Commission (SEC), reflects the ongoing confidence in Bitcoin as an asset class among institutional players, even in the face of market volatility.

Resilience in the Face of Bitcoin Price Decline

The data reveals that 44% of asset managers increased their Bitcoin ETF positions during the quarter, while 22% chose to hold their positions steady. In contrast, only 21% reduced their exposure, and a mere 13% exited their positions entirely. These figures are notable, especially considering that Bitcoin’s value dipped by 14.5% over the same period.

In an August 15 post on X, Bitwise’s Chief Investment Officer, Matt Hougan stated that the number of holder/ETF pairs across the ten available funds rose from 1,479 in the first quarter to 1,924 in Q2—a 30% increase that is particularly impressive given the market’s downturn.

Hougan’s observations also included a notable behavioral difference between institutional and retail investors. “If you thought institutional investors would panic at the first sign of volatility, the data suggest otherwise. They’re pretty steady,” Hougan noted.

The Big Players

Among the big players in the Bitcoin ETF space, hedge funds like Millennium, Schonfeld, Boothbay, and Capula were highlighted as significant holders. However, the diversity of investors in these ETFs is broadening. Hougan noted that beyond hedge funds, a variety of advisers, family offices, and select institutional investors are also participating in the market.

Hougan expressed optimism that over time, wealth managers and pension funds would account for an increasingly larger share of Bitcoin ETF investments.

Further cementing the institutional interest in Bitcoin, investment bank Morgan Stanley disclosed in its August 14 13F filing that it held 5,500,626 shares of BlackRock’s iShares Bitcoin Trust as of June 30, a position valued at approximately $188 million at the time. This holding places Morgan Stanley among the top five IBIT holders.

Goldman Sachs, another heavyweight in the financial sector, also revealed huge exposure to Bitcoin ETFs, with more than $238 million invested in shares of IBIT and other spot Bitcoin ETFs.

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