By Michael Scott
Spot Bitcoin ETFs ten-month spell realized half of the assets held by gold ETFs under management.
The US-listed Bitcoin exchange-traded funds (ETFs) are evident in accumulating tens of billions worth of assets. Despite their existence for ten months since their approval, the spot BTC ETFs have matched half of the assets held by the Gold ETFs.
The accelerated accumulation of assets by spot BTC ETFs is historic, given that gold ETFs have existed for two decades. The Bitcoin ETFs have witnessed substantial inflows since the January 10 greenlight granted by the US Securities and Exchange Commission (SEC).
The Bitcoin ETFs have attained$24.15 billion in net inflow while the total net assets are $69.84 billion per SoSoValue data. The latter translates to nearly 5.08% of the BTC market capitalization. The US-listed gold ETFs have $137.3 billion in total net assets, as per the World Gold Council data.
The ETF Store president, Nate Geraci, indicated that the 12 spot Bitcoin ETFs have, in the past 10 months, accumulated over 50% of the assets that gold ETFs have. In the Thursday post on X, the executive referenced the US-listed ETFs to portray the success of BTC ETFs against gold-affiliated ETFs despite being in existence since their approval in 2004.
Bitcoin and Gold Surge in Trump Victory
Gold and Bitcoin are poised for continued rise in Q4, thanks to the increased geopolitical uncertainty. A Thursday report by JP Morgan analysts acknowledged that strengthening the dollar, the upcoming US election and geopolitical uncertainty could fuel the demand for BTC and gold, thereby accelerating the prices.
The JP Morgan analysts consider the debasement trade —involving gold and Bitcoin — imminent. They attribute the trade to Donald Trump’s victory, expecting him to triumph over Kamala Harris.
The debasement trade occurs when most traders attempt to hedge against potential currency weakening, government deficits, and geopolitical headwinds. Over the years, gold has provided a good insurance policy against a potential weakening of fiat money. Leading asset manager BlackRock profiled Bitcoin as the digital gold, affirming it as an alternative to investing during uncertain times.
JP Morgan reveals the rising geopolitical tensions coincide with the US election, with both likely reinforcing the debasement trade that favors gold and BTC.
The report adds that the Grand Old Party (GOP) nominee emerges as the crypto-friendly candidate in the November 5 race. Additionally, Trump has vowed to raise tariffs likely to fuel inflation and geopolitical tensions identified as catalysts towards increased Gold and Bitcoin demand.
Growing Mainstream Interest in Bitcoin ETFs
The rapid adoption of the Bitcoin ETF portrays the growing mainstream interest in digital assets. In particular, the daily inflows have sustained satisfactory amounts ranging from $192M to $893M.
Merkle Tree Capital chief investment executive Ryan McMillin affirmed that BTC ETFs are well received with inflow records realized.
The crypto fund manager considers the gold ETFs to represent a stable hedge since their debut in 2004. However, McMillin admits the difficulty of comparing absolute flows as two decades when the spell features multiple inflation cycles.
McMillin considers the assets to be safe havens in their roles, with gold hailed for historical stability. Recently, Bitcoin has been a digital counterpart to gold owing to traditional financial systems’ finite supply and autonomy.
Fidelity Investments head of global macro Jurrien Timmer profiles Bitcoin as the exponential gold, asserting its rapid adoption curve and inherent scarcity. The executive perspective illustrates that the BTC value proposition extends beyond the digital gold tag. He emphasizes that it is now a store of value fueled by the network and finite supply.
McMillin considers BTC the best-performing company in 2024, with a 65% leap in its year-to-date to exchange hands for $69,533. Similarly, gold has sustained a solid performance, rallying at 16% within the same period and changing hands at $2,746 per ounce.
McMillin downplayed the 4% dip in Bitcoin witnessed on Thursday to offer a bullish outlook for Bitcoin as the year ends. The executive considers that BTC has witnessed several sell-offs as the whales reweigh their portfolios and take profits. Nonetheless, he rules out huge volatility as the US election concludes.
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