Bitwise CIO says BTC ETFs are a big hit and 13F filings make it ‘incredibly bullish’.
This week's 13F filing revealed who's buying Bitcoin ETFs and what their positions are, and Bitwise Chief Investment Office Matt Hougan says there's a significant point the media may be missing while celebrating the success of ETFs, even more hype on BTC ETFs.
Hugan said 563 professional investment firms reported owning Bitcoin ETFs worth a total of $3.5 billion. Hugan estimates that these numbers could eventually exceed 700 firms with total assets of nearly $5 billion.
Haugan's guess was spot on, with more than 900 firms disclosing their positions in Bitcoin ETF holdings, according to data from K33 Research.
In a May 16 post on X, K33 Research senior analyst Ventel Lunde shared the following chart;
“According to 13F filings, as of March 31, 937 professional firms invested in US spot ETFs. In contrast, 95 professional firms invested in gold ETFs in the first quarter (Bitwise).”
Bloomberg senior ETF analyst Eric Balchunas said that while the largest ETFs attracted the largest share of institutional capital, BlackRock IBIT attracted more than 400 holders.
Haugan called this a “huge success.”
“This is absolutely huge. For any financial advisor, family office or institution wondering if they're the only ones considering Bitcoin exposure, the answer is clear: you're not alone.
However, the executive stated that with assets under management (AUM) of more than 50 billion dollars, professional investors hold only 7-10% of the total investment, and K33 research data indicates that this share is 18%.
Lunde's X-Post explained,
“Retail is mostly floating. Professional investors held $11.06 billion in exposure at the end of Q1, representing 18.7% of BTC ETF AUM.
However, Hugan argued that media coverage of bitcoin ETFs as a retail-backed fund could be overlooking an important emerging trend that “surprisingly” leaves out of the original 13F filings.
The Bitwise CIO has laid out a common four-step investment trajectory across institutions, starting with a due diligence period that takes 6-12 months to evaluate an investment. The second step involves making a small personal allocation before professionals “expose their investors to the market”. Eventually, this leads to higher platform-wide allocations across the total client book, typically 1-5% of the portfolio, six months after the initial allocation.
“This tells me that the allocations we're seeing in recent 13F filings are just prepayments,” Hugan wrote.
Using Hightower Advisors as an example, Hugan explained that his current Bitcoin ETF allocation is only 0.05% of his assets. However, if you follow the typical four-step investment process, a 1% allocation over time equates to $1.2 billion for a single firm.
“Multiply that by the growing number of professional investors participating in the space and you can see what's behind my enthusiasm.”
This article does not contain investment advice or recommendations. Every investment and business activity involves risk, and readers should do their own research when making a decision.
