Jim Bianco, CEO of analytics firm Bianco Research, believes that spot Bitcoin exchange-traded funds (ETFs) need time to be an instrument of adoption.
In a recent X post, Bianco noted that spot Bitcoin ETFs have not yet met the high expectations set before the approval despite launching for trading in January.
The Bianco Research CEO noted that the recent outflows, investors facing losses in their positions, and the absence of significant institutional investment suggest that the Bitcoin ETF market may require more time to develop fully.
U.S. Spot Bitcoin Hits $1B in Net Outflows
Data from investment management company Farside Investors revealed that the U.S. spot Bitcoin ETFs have recorded over $1 billion in net outflows in the last eight trading days. The spot Bitcoin ETF market now holds approximately $48 billion in assets under management, a decline from its March peak of $61 billion.
Commenting on the post, Bianco noted that very little fresh capital has flowed into the crypto market, with most ETF inflows coming from on-chain holders transitioning back to Traditional Finance (TradFi) accounts.
“It’s not an adoption vehicle. Instead a small tourist tool and on-chain is returning to Tradfi,” Bianco said.
The research expert also predicted that the market may not reach its full potential until the next Bitcoin halving in 2028, coupled with major advancements in blockchain technology.
Other Analysts Weigh in
Not everyone agreed with Bianco’s thoughts on Bitcoin ETFs. For instance, Bloomberg’s senior ETF analyst, Eric Balchunas, pointed out in a September 8 post on X that Bitcoin ETFs have amassed billions in assets under management within just eight months.
“If IBIT has like $20 billion in assets and that’s considered a failure then what word should be used to describe an ETF with $7 million in assets?” Balchunas asked.
Another crypto analyst, Bryan Ross, took a different view from Bianco, arguing that “if most ETF trades are NOT institutional, this means institutions aren’t even here yet, and we could see massive institutional inflows next time FOMO and greed show up.”
Meanwhile, among the U.S. spot Bitcoin ETFs, BlackRock’s iShares Bitcoin Trust (IBIT) stands out with over $20 billion in inflows.
Fidelity’s Wise Origin Bitcoin Fund (FBTC) has attracted nearly $10 billion. The ARK 21Shares Bitcoin ETF (ARKB) and the Bitwise Bitcoin ETF Trust (BITB) have accumulated about $2 billion in net inflows.
