Bitcoin ETFs are DEMOLISHING Records: "This Is Crazy" | Eric Balchunas
May 17, 2024
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In this episode, Bloomberg's senior ETF analyst Eric Balchunas discusses the records shattered by Bitcoin ETFs, the importance of Bitcoin in portfolio completion, and forecasts institutional demand. He also shares insights on hedge funds and pension funds purchasing bitcoin ETFs, emphasizing the growing interest in ETFs among big institutional holders.
Bitcoin ETFs are attracting record-breaking inflows, showcasing intense investor interest and changing investment patterns.
Vanguard's appointment of a CEO with a background in Bitcoin ETF launches hints at a possible shift in anti-crypto policies and strategies.
Deep dives
Record-setting Inflows into Bitcoin ETFs
Bitcoin ETFs have seen unprecedented success with record-breaking inflows, such as Black Rock's reaching $10 billion in just 49 days, quicker than any previous record. The streak of 72 consecutive inflow days was exceptional in the ETF world, showcasing the intense investor interest. This anomaly reflects a shift in investment patterns, with Bitcoin ETFs attracting significant funds at a remarkable pace, surprising even seasoned analysts like Eric Bauchunas.
Vanguard's Leadership Shift and Potential Crypto Outlook
Vanguard's appointment of an outsider, Salim Ramji, as CEO marks a significant departure from tradition, hinting at possible shifts in strategy. While Vanguard's strict anti-crypto stance has been evident, Salim's background in overseeing Bitcoin ETF launches suggests a potential shift in the company's view. Ramji's expertise in indexing and low-cost investing aligns well with Vanguard's ethos, indicating a potential easing of anti-crypto policies in the future.
Implications of Bitcoin ETF Inflows on Vanguard's Business
The surge in Bitcoin ETF inflows, notably I-Bit's prominence, prompts a reevaluation of Vanguard's anti-crypto stance and its impact on investor perceptions. Eric Bauchunas highlights the significance of I-Bit becoming the second-largest ETF by inflows this year, emphasizing the evolving landscape within the investment sphere. The growing interest in crypto assets challenges Vanguard's traditional narrative, potentially nudging the company towards a more open stance on digital assets.
Institutional Adoption and the Role of Bitcoin ETFs
Institutional FOMO surrounding Bitcoin ETFs indicates a broader acceptance of digital assets among major players like pension funds and endowments. The remarkable number of 13F holders (over 400) in the Bitcoin ETF realm signifies institutional interest in Bitcoin as a portfolio diversifier. Notably, the accessibility and liquidity of Bitcoin ETFs like I-Bit are attracting diverse institutional investors, hinting at a broader shift towards including digital assets in traditional portfolios.
In this episode, Nik is joined by Bloomberg's senior ETF analyst Eric Balchunas. Eric details the records shattered by BlackRock's and Fidelity's bitcoin ETFs, explains why bitcoin gives investors portfolio completion, and forecasts the next couple years of institutional demand. He also opines on the latest disclosures showing that hedge funds and pension funds have started purchasing bitcoin ETFs.
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