Thomas Daniels
U.S.-listed spot Bitcoin and Ether exchange-traded funds (ETFs) saw a total of $38.3 billion in net inflows in a historic year for cryptocurrency ETFs, indicating strong demand from individual investors as well as increasing institutional interest.
The market was dominated by spot Bitcoin ETFs, which more than doubled early projections with net inflows of $35.66 billion for 2024. With $37.31 billion in net inflows, BlackRock’s iShares Bitcoin Trust ETF (IBIT) topped the field, followed by Fidelity’s Wise Origin Bitcoin Fund (FBTC) and ARK’s 21Shares Bitcoin ETF (ARKB), which came in second and third, respectively, with $11.84 billion and $2.49 billion. With $2.19 billion, the Bitwise Bitcoin ETF (BITB) came in second, according to Farside Investors data.
According to Galaxy Digital’s Alex Thorn, these numbers crushed the original prediction of $14 billion in first-year inflows. However, Bitcoin ETFs encountered challenges as the year came to an end, with outflows totaling $1.33 billion since December 19, including a $188.7 million loss for IBIT on December 24.
Retail investors accounted for 80% of the demand for Bitcoin ETFs in 2024, according to a data released by Binance in October. Analysts predict that this trend will change to institutional investors in 2025. Bitwise’s chief investment officer, Matt Hougan, believes that new clearinghouses and trading infrastructure would boost institutional participation and support the company’s optimistic $200,000 Bitcoin price prediction by 2025. Likewise, VanEck predicts that Bitcoin may reach $180,000.
With net inflows of $2.68 billion since their July 23 introduction, Spot Ether ETFs also had a big influence. The total inflows could have been $6.29 billion if Grayscale’s converted Ethereum Trust ETF (ETHE) had not experienced withdrawals.
The largest Ether ETF inflows were $3.52 billion from BlackRock’s iShares Ethereum Trust ETF (ETHA) and $1.56 billion from Fidelity’s Ethereum Fund (FETH). Bitwise’s Ethereum ETF (ETHW) provided more than $400 million, while Grayscale’s Ethereum Mini Trust ETF (ETH) contributed $608.1 million.
Although Ether did not perform as well as Bitcoin and Solana in 2024, analysts predict that it will in 2025. According to Bitwise, the rapid growth of stablecoins and real-world asset tokenization, as well as the increasing use of layer-2 solutions and spot ETF inflows, might propel Ethereum to $7,000 in the near future.
As the market for cryptocurrency exchange-traded funds (ETFs) develops, the increasing interaction between institutional and retail demand may spur more expansion in 2025, paving the way for a revolutionary period in digital asset investing.
