Investor appetite for Bitcoin exchange-traded funds (ETFs) remains strong despite continued caution from the U.S. Securities and Exchange Commission (SEC) as recent outflows have hit the market.
Bitcoin ETF flow
The US-based Spot Bitcoin ETF experienced significant outflows totaling $1.2 billion over the past four days, according to SoSoValue data.
On January 14, 12 spot ETFs collectively lost $209.82 million, with BlackRock's IBIT fund seeing the largest outflow of $219.48 million. This was the second-largest negative outflow for the fund since its inception a year ago, after the $332 million in outflows recorded earlier this year.
Meanwhile, Bitwise's BITB became the second ETF product to record outflows, with $8.93 million leaving the fund.
However, not all funds suffered losses. WisdomTree’s BTCW recorded net inflows of $10.24 million, while Van Eck’s HODL and ARK 21 Shares’ ARKB funds added $5.46 million and $2.89 million, respectively.
SEC is delayed by bits
The significant outflow comes as the U.S. Securities and Exchange Commission (SEC) extended its review of Bitwise's proposal to launch a broad-based crypto index ETF. A new decision deadline has been set for March 3.
The SEC explained that the delay will allow it to consider the proposal in more detail, which could be an important milestone for the industry.
The application was submitted in November 2024 and opened for public comment in December. No comments have been recorded yet, but regulators remain wary of the broader implications of these products.
According to the filing:
“The Commission may specify a longer period for taking action on proposed rule changes to allow sufficient time to consider the proposed rule changes and the issues raised therein. It was deemed appropriate.”
The proposed ETF would track the performance of the top 10 cryptocurrencies by market capitalization, including Bitcoin, Ethereum, and Solana.
Osprey moves to convert funds
Despite these general market conditions, Osprey Funds has announced plans to transition its Bitcoin trust into an ETF.
According to a Jan. 14 statement, Osprey intends to file with the SEC soon to facilitate the conversion.
Osprey Bitcoin Trust (OBTC) was established in February 2021 to provide investors with Bitcoin exposure while eliminating the complexities of direct ownership. As of January 14, the fund had $186.65 million in assets under management.
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