- Grayscale faces significant outflows, while BlackRock sees substantial inflows in Bitcoin and Ethereum ETFs.
- BlackRock plans no new crypto ETFs beyond Bitcoin and Ethereum, focusing on established cryptocurrencies.
Spot Bitcoin [BTC] and Ethereum [ETH] ETFs have drawn substantial interest from investors recently. Grayscale, however, faced notable outflows, with $210 million exiting its ETH ETF and $54.3 million from its Bitcoin ETF on 29th July.
In contrast, BlackRock has seen inflows of $58.2 million into its ETH ETF and $256.6 million into its BTC ETF on the same day.
Despite BlackRock’s impressive performance, the overall trend shows that while Bitcoin ETFs experienced net inflows totaling $124.1 million, ETH ETFs saw a net outflow of $98.3 million.
Cohen acknowledges ETH ETF flows
However, despite the negative flow of Ethereum ETFs BlackRock ETF and Index Investments CIO Samara Cohen in an interview with Bloomberg said,
“This is a story in the early days about access.”
She further explained that when assessing the health and activity of ETH ETFs, it’s crucial to consider both trading volumes and fund flows.
Cohen highlighted that a significant portion of Ethereum ETF trading volume—25%—is driven by substantial outflows, which could be due to higher-priced ETH ETFs and other investment vehicles.
She added,
“Investors really want to get their ETH exposures, especially if they are going to use it in the context of an overall portfolio in an ecosystem they have confidence in.”
No Solana ETF?
In a surprising shift, Cohen also revealed that BlackRock does not plan to introduce additional crypto ETFs, including a spot Solana ETF, in the near future.
She emphasized that, although Bitcoin and Ethereum have met the firm’s criteria for investment, no other altcoins currently meet the necessary standards.
“We really look at the investability to see what meets the criteria, what meets the bar to be delivered in an ETF. For us, both in terms of investability and also what we hear from our clients, Bitcoin and Ethereum definitely meet that bar, but it will be a while before we see anything else.”
This decision underscores BlackRock’s cautious approach to expanding its crypto ETF offerings, focusing solely on the two most established cryptocurrencies.
This also aligns with BlackRock’s head of digital assets, Robert Mitchnick, who, in a recent Bitcoin conference, reiterated that the firm sees no immediate prospects for new crypto ETFs.
In conclusion, BlackRock’s CIO, Samara Cohen, anticipates that crypto ETFs will become a fixture in “model portfolios” by the end of 2024.
This reflects BlackRock’s strategic focus on navigating the crypto market with a measured approach.
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