Emily Walker
Spot Bitcoin (BTC) exchange-traded funds (ETFs) experienced their first decline in weekly performance in a month during the week of Christmas, marking the most significant drop since September. Despite this, analysts pointed out that the ETF market had its most successful year yet.
Bitcoin ETFs Have a Tough Christmas
As the calendar year comes to a close, Bitcoin ETFs have reached their lowest weekly performance in three months. Between December 23 and December 27, these crypto-based investment products faced considerable outflows, marked by three days of declines last week.
The week began for BTC ETFs with a negative net flow of $564.94 million during the first two days, although there was a brief rebound on December 26. Following a momentary Christmas surge where Bitcoin climbed to the $98,000-$99,000 range, the ETFs saw an inflow of $475.5 million, their strongest daily performance since the recent downturn began.
However, a set of outflows totaling $297.75 million on Friday reversed this positive trend, resulting in total outflows of $862.69 million for the week. Consequently, Bitcoin ETFs ended up with a net negative volume of $387.54 million for the last week of 2024.
Fidelity’s FBTC was the greatest loser, facing $208 million in outflows on Friday, marking its second-worst single-day performance this month. BlackRock’s IBIT followed closely, suffering a negative net flow of $188.7 million.
In contrast, ARK 21Shares’s ARKB reported the second-highest inflows in the past week, closing with $186.9 million. Additionally, FBTC had a standout day earlier in the week, achieving its highest performance with inflows of $254.4 million on Thursday.
A Record Year for ETFs
It’s important to highlight that these investment products have been facing substantial outflows for two weeks, interrupting a prior 15-day streak of inflows that boosted BTC ETFs’ total net assets from $100 billion to $120 billion.
According to ETF expert and Bloomberg analyst Eric Balchunas, the net assets of spot Bitcoin ETFs were approaching $128 billion by December 17, indicating an “unreal” level of performance for crypto-based products just 11 months into their existence.
Data from SoSoValue indicates that total outflows from Bitcoin ETFs have exceeded $1.8 billion, bringing total net assets down to $106.68 billion since the downturn began.
Despite this recent downturn, Matthew Bartolini, Head of SPDR Americas Research at State Street Global Advisors, described the global ETF industry as concluding its best year ever in an interview with FOX Business.
The report emphasized the increase in active funds and the strong demand for new crypto-focused investment products. Sumit Roy, a senior ETF analyst for ETF.com, noted that the launch of new ETFs contributed to the year’s impressive performance.
Another reason has to do with the launch of crypto ETFs. You’ve seen Spot Bitcoin ETFs now pop up in January; inflows have just been insane.
Balchunas earlier remarked that BTC ETFs serve as “the primer vehicle” for traditional investors and are a “disruptive powerhouse” with a significant connection to Bitcoin as a long-term investment. He indicated that these investment products demonstrated resilience throughout the year’s downturns and are expected to continue exceeding expectations despite some recent challenges.
Importantly, spot Bitcoin ETFs have significantly outperformed expectations this year, gaining $35.65 billion in positive net flows in 2024, according to data from Farside Invest .
