The net assets of Bitcoin ETFs in the US have exceeded $100 billion for the first time, nearing the size of gold ETFs, following Donald Trump's victory in the presidential election.
November 21 marks an important milestone for the cryptocurrency market as the total net assets of Bitcoin exchange-traded funds (ETFs) in the US have for the first time surpassed the $100 billion threshold, according to data from Bloomberg Intelligence.
This remarkable growth occurs against the backdrop of Bitcoin's strong price increase following Donald Trump's victory in the US presidential election on November 5, indicating growing investor interest in this digital asset.
The launch of spot Bitcoin ETFs in January of this year has significantly energized the market. As of November 21, Bitcoin ETFs are managing approximately $104 billion in assets, closing in on the size of gold ETFs with around $120 billion in assets under management (AUM), according to Bitcoin Archive.
Source: Bitcoin Archive
Eric Balchunas, an ETF analyst at Bloomberg Intelligence, commented on platform X that Bitcoin ETFs have reached 97% progress towards becoming the largest Bitcoin holder and 82% progress towards surpassing gold ETFs.
The allure from Mr. Trump's victory
Mr. Trump's victory, who is considered crypto-friendly, has driven a strong wave of investment into the cryptocurrency market. Cointelegraph Research reports that many investors believe the new administration will facilitate the development of this industry. The spot price of Bitcoin surged to over $96,000 on November 21, marking a nearly 120% growth since the beginning of 2024, according to data from Google Finance.
The boom is clearly reflected in the trading activity of BlackRock's iShares Bitcoin Trust (IBIT), the leading Bitcoin ETF with net inflows reaching $30 billion since January. On November 6, IBIT recorded a record trading volume as investors flocked to cryptocurrencies following Mr. Trump's victory.
Just one day later, IBIT attracted an additional $1.1 billion in capital, quickly recovering after two days of outflows totaling $113.3 million, according to data from Farside. In second place for inflows is the Fidelity Wise Origin Bitcoin Fund (FBTC) with over $11 billion as of now in 2024.
The strong growth of Bitcoin ETFs also reflects the trend of seeking inflation-hedging investment channels amid increasing geopolitical instability. A report from JPMorgan on October 3 indicated that investors are turning to gold and Bitcoin as part of a 'currency inflation hedge trade' strategy in light of concerns about a negative economic scenario. MV Global predicts that Bitcoin's price could reach between $100,000 and $150,000/BTC.
Notably, BlackRock's IBIT fund currently holds more assets than this asset manager's own gold ETF, even though it was only launched in January, according to data from BlackRock.
