- Grayscale is seeing significant outflows, while BlackRock is seeing significant inflows in Bitcoin and Ethereum ETFs.
- BlackRock is not planning any new crypto ETFs outside of Bitcoin and Ethereum, focusing on established cryptocurrencies.
Discover Bitcoin [BTC] and ether [ETH] ETFs have received significant interest from investors recently. However, Grayscale experienced a notable outflow, with $210 million going out ETH ETF and $54.3 million from its Bitcoin ETF on July 29.
BlackRock, on the other hand, has seen inflows of $58.2 million into its ETH ETF and $256.6 million into its ETF. BTC ETF on the same day.
Despite BlackRock’s impressive performance, the overall trend shows that while Bitcoin ETFs saw net inflows totaling $124.1 million, ETH ETFs saw net outflows of $98.3 million.
Cohen acknowledges ETH ETF flows
Despite the negative flow from Ethereum ETFs BlackRock ETF and Index Investments CIO Samara Cohen said in an interview with Bloomberg:
“This is an early-era story about access.”
She further explained that when assessing the health and activity of ETH ETFs, it is critical to consider both trading volumes and fund flows.
Cohen highlighted that a significant portion of Ethereum ETFs’ trading volume – 25% – is driven by significant outflows, which could be due to more expensive ETH ETFs and other investment vehicles.
She added:
“Investors really want to get their ETH exposure, 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 move, Cohen also revealed that BlackRock has no plans to introduce additional crypto ETFs, including a spot Solana ETF, in the near future.
She emphasized that while Bitcoin and Ethereum meet the company’s investment criteria, no other altcoins currently meet the necessary standards.
“We really look at investability to see what meets the criteria, what meets the requirements to be delivered in an ETF. For us, both in terms of investability and what we’re hearing from our customers, Bitcoin and Ethereum certainly meet that bar, but it will be a while before we see anything different.”
This decision underlines BlackRock’s cautious approach to expanding its crypto ETF offering, focusing solely on the two most established cryptocurrencies.
This also lines up with BlackRock’s head of digital assets, Robert Mitchnick, who reiterated at a recent Bitcoin conference that the company sees no immediate prospects for new crypto ETFs.
In conclusion, BlackRock’s CIO, Samara Cohen, expects crypto ETFs to 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.