BlackRock’s iShares Bitcoin Trust (IBIT) has recently captured headlines for suffering an unprecedented outflow as we kick off the new year. After the New Year’s Day holiday, on January 2, IBIT recorded a staggering $332.6 million in outflows. This significantly surpassed the previous record of $188.7 million set just days earlier on December 24, 2024. As this marks the third consecutive trading day of withdrawals for IBIT, the week’s total has climbed to $392.6 million.
Despite these concerning trends, IBIT remains a formidable player in the ETF market. Impressively, it occupies the third position for U.S. ETF inflows in 2024, with a substantial $37.2 billion, trailing behind the Vanguard 500 Index Fund and iShares Core S&P 500 ETF, which saw $116 billion and $89 billion coming in, respectively.
While many wring their hands over this dip, Bitcoin trailblazer Adam Back suggests that a turnaround for IBIT is on the horizon in 2025. In stark contrast to IBIT’s struggles, other Bitcoin ETFs such as those managed by Fidelity, Bitwise, and Ark 21Shares recorded inflows of $48.3 million, $36.2 million, and $16.5 million on the very same day. Even Grayscale’s Bitcoin Mini Trust saw a modest inflow of $6.9 million, though its larger GBTC fund faced a $23.1 million outflow. Overall, total outflows for the day reached $242 million, with IBIT’s record-setting withdrawals overshadowing gains by its competitors.
Looking ahead, Nate Geraci, president of the ETF Store, shares a hopeful outlook for the year, forecasting the advent of combined spot Bitcoin and Ether ETFs along with other innovative financial products. He emphasizes that these developments could potentially lead to a bolstered market.
Bitcoin ETFs in the U.S. currently command an impressive 5.7% of the total Bitcoin supply, marking a significant milestone with cumulative holdings approaching $110 billion. BlackRock leads this charge with over 542,000 BTC, giving its fund a substantial 47.9% market share. This brings IBIT to the forefront as the 34th-largest ETF globally.
As 2025 approaches, expectations are high that BlackRock’s influence will enable even more institutional adoption of Bitcoin. Ryan Lee, a chief analyst at Bitget Research, predicts that this growth could push Bitcoin’s price to an eye-watering $200,000, though he cautions that such a rise hinges on crucial regulatory changes and general market circumstances.
Meanwhile, in South Korea, the Korea Exchange (KOSDAQ) is turning heads by considering the launch of crypto spot ETFs next year. This came after a not-so-smooth end to 2024, filled with political strife. KOSDAQ Chairman Jeong Eun-bo sees crypto ETFs as a pathway to rejuvenating the market, while the Financial Services Commission (FSC) is also keen to advance security token offerings (STOs).
As for Russia, Evgeny Shatov from Capital Lab paints an optimistic picture, predicting that Bitcoin’s price may soar to $135,000 by mid-2025. He mentions Bitcoin’s unique capacity as a “super currency,” able to navigate around U.S.-led sanctions due to its decentralized structure. The conversation about Bitcoin’s utility and price trajectory takes on new weight as we head into a transformative year for the cryptocurrency market.
In summary, while IBIT faces challenges at the start of the year, the broader tendencies within the cryptocurrency landscape, paired with institutional interest and new innovations, hint at a potentially exciting time ahead for Bitcoin and its various ETFs.
