The beginning of the year has witnessed a remarkable performance by Bitcoin and cryptocurrency Exchange Traded Products (ETPs). According to a comprehensive report from CoinShares, authored by James Butterfill, these financial instruments have experienced substantial inflows amounting to $585 million in just the first few days. Analysts attribute this robust start to the continuation of the positive momentum observed in the crypto sector throughout last year.
Significant Inflows and Market Dynamics
In the CoinShares report, it was unveiled that crypto ETPs saw a massive $44 billion in inflows throughout 2024, with Bitcoin emerging as the most actively traded digital asset. Specifically, Bitcoin attracted $38 billion in inflows, accounting for nearly 30% of all Assets Under Management (AUM). Ethereum also gained traction, particularly in the second half of the year, with net inflows exceeding $4.8 billion.
Bitcoin ETPs Lead The Pack
James Butterfill from CoinShares highlighted these findings on the performance of crypto ETPs across various platforms, including the company’s official website and social media channels. The report emphasized that Bitcoin ETPs were the favored digital investment product, securing $38 billion of the global Bitcoin AUMs in ETPs.
During 2024, the crypto ETP market saw an influx of $44 billion, setting a promising tone for 2025 with $585 million inflows recorded so far. Ethereum ETPs followed, receiving approximately $4.8 billion in inflows, equating to 26% of all Ethereum AUMs. This marks a significant growth, nearly 2.4 times the inflows seen in 2021 and 60 times those recorded in 2023. Ethereum managed to outpace Solana, which only attracted $69 million, representing a mere 4% of the total assets under management in the ETP sector.
Approval Of Spot ETFs Spurs Growth
The cryptocurrency industry experienced record-breaking inflows in 2024, surpassing even the bull market of 2021. That year, cryptocurrency investment products accumulated over $10 billion in net inflows. Last year’s figures were four times greater. The surge was largely attributed to the approval of spot ETFs for Bitcoin by the US Securities and Exchange Commission in January 2024. This regulatory green light was extended to 11 applications for spot Bitcoin ETFs, followed by eight spot ETFs for Ether later in May.
James Butterfill noted that these spot Bitcoin ETFs play a crucial role in driving inflows into Bitcoin-related investments. He further explained that the introduction of these ETFs will significantly influence future inflows into the crypto investment sector.
Better Days Ahead For US Bitcoin Spot ETPs
In addition to CoinShares, Galaxy Digital painted an optimistic picture for the future of the crypto investment landscape. In a report released on December 31st, 2024, Galaxy Digital forecasted that the US spot ETPs market would continue its upward trajectory in 2025, potentially reaching $250 billion in AUMs by year’s end.
Alex Thorne of Firmwide Research emphasized that Bitcoin ETPs are on the verge of matching the total value of assets under management held by US gold ETPs. Thorne also suggested that Bitcoin would remain one of the top-performing assets on a risk-adjusted basis. Other analysts echoed this sentiment, predicting a surge in Ether’s spot ETPs throughout the year. The Ethereum blockchain is expected to benefit from a supportive political climate and favorable regulatory changes.
