Crypto inflows tripled to $2.2B in 2023

ProShares’ bitcoin futures ETF accounted for substantial flows in lead-up to potential spot fund approval

article-image

Mehaniq/Shutterstock modified by Blockworks

share

Inflows into crypto investment products eclipsed $2.2 billion in 2023 — nearly triple the total seen the prior year.

Net inflows into such vehicles spiked sharply from the roughly $800 million seen in 2022. However, the yearly total lagged 2020 and 2021, during which crypto products notched inflows of $6.6 billion and $10.7 billion, CoinShares data shows. 

The segment’s assets under management increased by 129% during 2023, ending at $51 billion — the highest level since March 2022.

“Much of the recovery was in the final quarter where it became increasingly clear that the [US Securities and Exchange Commission] was warming up to the launch of bitcoin spot-based ETFs in the United States,” CoinShares head of research James Butterfill wrote in a Wednesday report

Read more: With bitcoin ETF decision imminent, industry watchers debate if SEC will delay  

The SEC is expected to rule on spot bitcoin ETFs by Jan. 10. Though bitcoin’s price dipped Wednesday, the asset is up more than 150% in the past year. 

Bitcoin products accounted for about 87% of the net inflows in 2023. About a third of the yearly asset gains — $792 million — came from US vehicles. 

From an issuer standpoint, ProShares was a standout. It beat all other competitors with $640 million in net flows. 

The Maryland-based company launched the first bitcoin futures ETF in October 2021. The ProShares Bitcoin Strategy ETF welcomed $506 million in net flows in 2023 and now has roughly $1.7 billion in assets. 

Bloomberg Intelligence analyst Eric Balchunas said on Bloomberg TV in November that BITO’s inflows are a bit ironic considering the fund’s potential fate. 

“This is the ETF that’s probably going to be sort of under pressure, or seeing some exodus, once the spot ETFs come out, because people prefer those,” he said at the time. “But until then, it’s being used in anticipation of those ETFs.” 

ProShares was also among the several issuers to launch the first ether futures ETFs last year. But its three funds that hold ether futures contracts only account for about $20 million in combined assets. 

Solana-focused products tallied $167 million in net inflows in 2023, according to CoinShares, ranking ahead of ether and short bitcoin funds, which notched $78 million and $60 million, respectively. 


Don’t miss the next big story – join our free daily newsletter.

Tags

Upcoming Events

Salt Lake City, UT

WED - FRI, OCTOBER 9 - 11, 2024

Pack your bags, anon — we’re heading west! Join us in the beautiful Salt Lake City for the third installment of Permissionless. Come for the alpha, stay for the fresh air. Permissionless III promises unforgettable panels, killer networking opportunities, and mountains […]

recent research

ao cover.jpg

Research

Arweave recently launched the testnet for AO computer, a new messaging protocol that will sit atop a PoS network and aims to become a scalable global compute platform through parallel processing and modularity.

article-image

The “fastest-growing ETF in history” has seen net inflows on every trading day since its Jan. 11 launch

article-image

Relm and Chainproof will provide insurance quotes to distributed validators

article-image

DLC.Link uses a Taproot-based Bitcoin multisig to let institutions mint dlcBTC, starting on Arbitrum

article-image

Pre-seed Bitcoin startup deals rose 360% in 2023, a TVP report shows

article-image

Circle’s new smart contract to allow holders of BlackRock USD Institutional Digital Liquidity Fund to redeem shares for its stablecoin

article-image

Uniswap says it was not surprised to receive a Wells notice given the SEC’s “abusive” use of power as of late