Retail investors fuel 80% of demand for Bitcoin ETFs

According to recent Binance research, Bitcoin ETFs now account for an average of 26.4% of BTC spot trading volume, with occasional peaks as high as 62.6%. This shift has contributed to Bitcoin's growing market dominance.

The Bitcoin ETF has outperformed its predecessor, the Gold ETF, with net income exceeding $18.9 billion in less than a year. More than 1,200 institutions have invested in Bitcoin ETFs, up from 95 institutions that backed gold ETFs in their initial stages.

Bitcoin ETF investments are held by retail investors.

Retail investors represent 80% of demand for Bitcoin ETFs, while institutional participation has grown by 30% since the first quarter. Investment advisors showed the highest growth, with a 44.2% increase in holdings.

Read more: What is a Bitcoin ETF?

Although it may take years to integrate Bitcoin ETFs with broker-dealers, banks and advisors, this gradual process is expected to foster wider adoption in the medium term, according to a Binance research report shared with BeInCrypto.

Investor interest in ETFs continues to grow, with 45% of ETF investors planning to allocate to digital assets in the next year. This puts crypto ETFs as the second most popular asset class after equities, surpassing bonds and discretionary alternative investments.

“Gold collected more than 1 million ounces of ETF inflows last week, the largest since October 2022—wild indeed! History shows that when the gold rush cools down, Bitcoin usually goes bananas. Since April, BTC has hovered between $50k and $70k, while gold and silver have continued to rise. With a solid $2 billion inflows into Bitcoin ETFs recently, there is hope that BTC may finally break out that high after the US election, influencer Mario Naufal wrote on XPost (formerly Twitter).

The survey shows that millennials are dominating the demographic of crypto ETF investments. Over 62% of investors in this space belong to this demographic. In contrast, Baby Boomers showed a very low interest.

ETF earnings have become a key market indicator for cryptocurrencies. ETF inflows and outflows have been closely linked to price movements in recent months.

Read more: How to invest in Ethereum ETFs?

In comparison, Ethereum ETFs have seen weak demand. Ethereum's flow has reached $103.1 million in the last few months. Notably, Ethereum ETFs have recorded negative net flows in 8 of the past 11 weeks.