Grayscale’s Bitcoin ETF Market Dominance Drops To 50%

The market share of Grayscale’s Bitcoin ETF has dropped below 50% for the first time since spot Bitcoin ETFs began trading in the US.

For the first time since spot Bitcoin exchange-traded funds (ETFs) began trading in the United States on January 11, the market share of the spot Bitcoin ETF managed by Grayscale, a cryptocurrency asset management, has dropped below fifty percent.

According to the statistics provided by Dune Analytics, the total assets under management (AUM) in the Grayscale Bitcoin Trust (GBTC) fell to $28.5 billion as of March 12th.

This means that Grayscale’s Bitcoin ETF currently accounts for 48.9% of the total $56.7 billion that is held across ten Bitcoin exchange-traded funds (ETFs) trading in the United States.

On the first trading day of the 10 spot Grayscale’s Bitcoin exchange-traded funds (ETFs) in the United States, Grayscale’s fund accounted for around 99.5% of their total assets under management (AUM).

The market share of the exchange-traded fund (ETF) has been declining over time as a result of steady daily outflows from the GBTC, which averaged $329 million per day over the previous week.

The most significant outflows of GBTC occurred within the first month after Bitcoin ETFs were live, with $7 billion leaving the fund in a little over a month. However, the outflows started to slow down by the end of January, which led some analysts to speculate that they might be coming to an end.

However, in the middle of February, bankruptcy courts granted Genesis permission to liquidate approximately $1.3 billion worth of GBTC shares as part of efforts to reimburse investors. This resulted in an increase in the amount of money that was being taken out of the company.

Based on the data provided by Farside Bitcoin ETF flow, the total amount of GBTC outflows has reached slightly more than eleven billion dollars. When it was first introduced, Grayscale’s Bitcoin exchange-traded fund (ETF) was a trust that enabled institutional investors to obtain exposure to Bitcoin by committing funds for a period of at least six months.

However, the trust was converted into an exchange-traded fund (ETF) after a court victory over the Securities and Exchange Commission in August and the regulator’s subsequent approvals of other spot Bitcoin ETF applications.

This made it possible for institutional investors, who had previously taken advantage of a GBTC arbitrage trade, to either permanently remove their money from the fund or simply transfer their assets to Bitcoin exchange-traded funds (ETFs) that had lower costs.

Despite the fact that the market was initially frightened by the growing outflows from the GBTC, the growing net inflows into BlackRock’s iShares Bitcoin ETF (IBIT) and the Fidelity Wise Origin Bitcoin Fund (FBTC) funds have been a cause for optimism.

Both of these funds have now generated a total of $16.9 billion worth of inflows since their inception. Several market experts have attributed the rapid appreciation of the price of Bitcoin, which reached a new all-time high of $72,900 on March 11, to the increased inflows into the nine newly created exchange-traded funds (ETFs).

This is one of the key driving causes behind the rapid appreciation of the price of Bitcoin. K33 Research data indicates that BlackRock’s fund currently possesses a little more than 200,000 Bitcoin, which is equivalent to approximately $14.3 billion at the current pricing.