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Spot Bitcoin ETFs See $302 Million Inflows, Led by Fidelity's FBTC
U.S. spot Bitcoin exchange-traded funds experienced a substantial daily net inflow of $302.97 million, marking the largest inflow since May 3rd. Fidelity's FBTC led the inflows with $131 million, followed by Bitwise $86 million. Other funds like ARKB, managed by Ark Invest and 21 Shares, saw $39 million in inflows. Grayscale's GBTC also had significant net inflows, bringing in $27 million. Investment advisors and hedge fund managers view BTC ETFs as a unique hedge, providing diversification benefits. Despite fluctuations, cumulative net inflows for these ETFs have reached $12 billion since their debut in January. As of Wednesday, 11 spot Bitcoin ETFs in the U.S. have accumulated $12.15 billion in net inflows. Trading volume for these ETFs has declined since its peak in March. The price of Bitcoin rose to $66,081 within the past 24 hours. Millennium Management, a New York-based hedge fund, disclosed holdings of $1.94 billion in five spot Bitcoin ETFs as of March 31, with the largest allocation in BlackRock's IBIT.
China Disrupts $1.9 Billion Underground Banking Scheme Involving USDT
Chinese police have dismantled an underground banking operation in Sichuan province, which used USDT stablecoin for foreign currency exchanges totaling $1.9 billion. The criminal group primarily served individuals involved in smuggling goods or seeking overseas asset purchases. Authorities arrested 193 suspects nationwide and froze assets worth 149 million yuan. The group, led by individuals with surnames Lin, Weng, and Chen, utilized USDT for illegal currency exchanges starting from January 2021. This bust is part of China's efforts to combat underground banking activities that use cryptocurrency to bypass capital control policies.
Millennium Management, an international hedge fund, has disclosed holdings of nearly $2 billion across five different spot Bitcoin exchange-traded funds (ETFs) as of the first quarter of 2024. The hedge fund diversified its holdings among various Bitcoin ETFs, including ARK 21 Shares Bitcoin ETF, Bitwise Bitcoin ETF, Grayscale Bitcoin Trust, iShares Bitcoin Trust, and Fidelity Wise Origin Bitcoin ETF. Notably, Millennium's largest allocation is in BlackRock's Bitcoin fund, with over $844 million invested, followed closely by Fidelity's fund with just over $806 million. This significant investment makes Millennium the leading holder of Bitcoin ETFs, demonstrating substantial institutional interest in these products. The recent surge in compulsory 13F filings has provided insights into the growing interest from professional investors and institutions in Bitcoin ETFs, signaling a positive outlook for Bitcoin's future.
Trading Desk Insights
Bitcoin surged by over 7.5% on Wednesday, marking its strongest performance since March 20th. The cryptocurrency successfully breached its 50-day moving average for the first time since April 13th. While a slight retreat to around $65,000 may be on the horizon, the overarching breakout trend is expected to persist, potentially driving Bitcoin towards its annual peak.
The latest weak U.S. economic data has bolstered the likelihood of a Federal Reserve rate cut come September. This shift may also prompt rate reductions by the Bank of England and the European Central Bank as early as June. As central banks globally lean towards monetary easing, this pivot bodes well for risk assets, including cryptocurrencies. The trend among global central banks is swiftly moving from rate hikes to cuts.
Turning to U.S. Bitcoin ETFs, the sector observed a substantial $303 million in inflows—the largest since May 3rd—primarily driven by issuers like Grayscale, although Blackrock saw no new inflows for the third straight session.
CME Group, the largest futures exchange globally, is gearing up to introduce Bitcoin trading, aiming to tap into the burgeoning demand from Wall Street money managers keen on the cryptocurrency sector.
Meanwhile, the ETHBTC ratio has hit a three-year low, sliding further by nearly 16% year-to-date amidst uncertainties around the potential launch of a spot ETH ETF in the U.S. and competition from emerging platforms like Solana.
In other developments, ShibaSwap has expanded onto the Shibarium blockchain, enhancing opportunities for users to create liquidity pools and derive income from liquidity provision. The increased transaction activity on Shibarium is expected to accelerate the burn rate for SHIB tokens, thereby reducing their circulation.
Stock futures remained relatively stable on Thursday following a lighter-than-expected inflation report, which propelled the major averages to new record highs. The S&P 500 notably surged past 5,300 for the first time on Wednesday.
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This research is for informational use only. This is not investment advice. Other than disclosures relating to Secure Digital Markets this research is based on current public information that we consider reliable, but we do not represent it is accurate or complete, and it should not be relied on as such. The information, opinions, estimates, and forecasts contained herein are as of the date hereof and are subject to change without prior notification. We seek to update our research as appropriate.
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