Grayscale’s Bitcoin Trust Sees Outflows Drop To Lowest Since It Converted To A Spot Bitcoin ETF

Updated: 26 February 2024

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The Grayscale Bitcoin Trust (GBTC) on Feb. 23 recorded its lowest outflows since it converted to a spot Bitcoin ETF (exchange-traded fund) on Jan. 11.

BitMEX Research data shows that withdrawals for GBTC totalled just $44.2 million on Friday. It hemorrhaged $5.64 billion in outflows in January, with $640 million being withdrawn from the ETF on Jan. 22 alone.

February has been a better month, with only $1.8 billion leaving the fund so far. Overall, investors have pulled a collective $7.4 billion from the fund since its conversion.

Bitcoin ETF Flow – 24 Feb 2024

All data now in, except perhaps for the Galaxy/Invesco product

Friday was a strong day, with +$232.3m of net inflow. Also, the outflow for GBTC was just $44m, lowest level since 11th Jan pic.twitter.com/1Q0OtjEJLt

— BitMEX Research (@BitMEXResearch) February 24, 2024

Grayscale’s Bitcoin ETF Is Still Underperforming Competitors

Although the reducing outflows is good news for GBTC, the ETF is still underperforming its competitors.

BlackRock’s IBIT fund has led the charge since the U.S. Securities and Exchange Commision (SEC) approved spot Bitcoin ETFs on Jan. 11, accumulating assets of more than $6.6 billion. Fidelity’s FBTC takes second place, with its inflows totaling over $4.7 billion during the same period.

Cathie Wood’s ARK21 Shares takes third place after amassing $1.4 billion in assets.

GBTC Outflows To Continue Unless It Slashes Fees

JPMorgan warned earlier that GBTC may continue to lose market share to competitors including BlackRock and Fidelity if it does not slash its ETF fees. GBTC currently charges the highest fees of all the spot Bitcoin ETFs in the market, even after it reduced its management charge to 1.5% from 2%.