Fidelity’s Bitcoin exchange-traded fund (ETF) has recently seen a significant increase in investments, with a reported $208 million inflows on January 29. This marks the first time Fidelity’s inflows have surpassed Grayscale Bitcoin Trust’s (GBTC) outflows since its initial launch.
Fidelity’s Bitcoin ETF, FBTC, experienced an impressive $208 million inflows on January 29. Meanwhile, GBTC saw $192 million in outflows on the same day, which is the lowest since the fund’s relaunch, according to data from BitMEX Research. GBTC’s latest outflows represent a considerable decrease from previous figures, with a 25% drop from $255 million on January 26 and a significant 70% decrease from the peak outflows of $641 million on January 22.
Grayscale’s fund experienced one of its lowest outflow days, second only to January 11, when it was converted to a spot Bitcoin ETF and saw $95 million leave the fund. Crypto traders and analysts keenly observe these slowed-down outflows from GBTC, interpreting them as signs of investors cashing out from previously unprofitable positions.
Analysts at JPMorgan noted on January 25 that GBTC’s outflows had been putting downward pressure on Bitcoin’s price, but they believe this trend is mostly behind us now.
Data on January 29 shows a surge in trading volumes for the nine new U.S. spot Bitcoin ETFs, reaching a combined $994.1 million. This nearly doubles GBTC’s volume of $570 million for the same day. BlackRock’s iShares Bitcoin Trust (IBIT) and Fidelity’s FBTC were the most significant contributors to this volume.
In a competitive market for spot Bitcoin ETFs, fund issuers in the U.S. and internationally are reducing fees to draw investors. Invesco and Galaxy Asset Management announced a fee reduction for their joint ETF, the Invesco Galaxy Bitcoin ETF (BTCO), from 0.39% to 0.25%.
This fee reduction trend is also affecting Europe’s ETFs. CoinShares suggests traders might be moving from Europe-based products to those in the U.S. In response, Invesco and WisdomTree have recently cut fees on their Europe-based Bitcoin ETFs, and CoinShares followed suit with its flagship Bitcoin ETF.
