In the rapidly evolving world of digital finance, the ProShares Bitcoin Strategy ETF, the first Bitcoin-based ETF in the United States, has reached a new record in assets under management (AUM), achieving nearly $1.5 billion in Bitcoin futures contracts. This record growth indicates increasing interest from financial institutions in cryptocurrencies, especially in anticipation of the approval of an ETF directly based on Bitcoin.
The ProShares Bitcoin Strategy ETF (BITO) – the first of its kind in the United States – has reached a record value of assets under management (AUM), exceeding $1.47 billion. This is a signal of increased interest from financial institutions in cryptocurrencies, especially in the context of the expected approval of a Bitcoin-based ETF, known as a “spot ETF.”
BITO recorded its previous record of $1.44 billion on November 10, 2021, just three weeks after its launch. This value has increased along with the price of Bitcoin itself, which at that time reached a historical high of $69,000.
The new record, set on Tuesday, coincided with Bitcoin’s new annual high of $38,300. Over November, the fund’s AUM value rose from $1.1 billion to $1.42 billion. Bloomberg ETF analyst Eric Balchunas indicated that about $240 million of the growth since early October was due to new, specific inflows.
Since its inception, BITO’s average daily trading volume is $160 million, placing it in the top five of all American ETFs. Global Bitcoin investment funds have attracted significant capital over the past month, reaching a total of $32 billion AUM. In addition to ProShares, investment products from Purpose Investments – owner of the world’s first Bitcoin-based ETF in Canada – attracted $246 million this month.
The difference between an ETF based on futures contracts and a “spot ETF” is that the latter secures its shares with actual BTC held by the fund, instead of Bitcoin futures contracts. As a result, the fund’s shares reflect the price of Bitcoin more accurately than their futures-based counterparts. For example, BITO shares have increased by 79.94% since the beginning of the year, while shares of the Purpose Bitcoin CAD ETF (BTCC.B) have increased by 122%. Meanwhile, Bitcoin itself has gained 127%.
U.S. regulatory bodies have so far refused to approve a Bitcoin-based ETF, but recent market events suggest that such a fund may appear within the next two months. Many applicants, such as BlackRock and Grayscale, are actively discussing with the Securities and Exchange Commission (SEC) about preparing their ETFs for market entry.
Experts believe that an ETF directly based on Bitcoin will enable financial institutions to invest in BTC, which until now was not available for direct 1:1 investment in assets. For now, many interested parties who managed portfolios had to settle for nearly equivalent products, such as BITO, Coinbase (COIN), and MicroStrategy (MSTR).
Photo: ProShares
