The first US Bitcoin ETF reaches record AUM, rising to $1.47 billion.

The ProShares Bitcoin Strategy ETF (BITO) – the first Bitcoin (BTC) ETF launched in the United States – set a new record in assets under management (AUM) this week, now boasting nearly $1.5 billion in Bitcoin futures contracts.

The filing reflects eagerness among institutions to gain exposure to BTC ahead of the widely anticipated approval of the Bitcoin Space ETF in January.

Bitcoin funds are deep in capital

BITO hit its previous record of $1.44 billion on November 10, 2021 – almost three weeks after its initial launch, and the day BTC hit an all-time high of $69,000.

The new record on Tuesday brought that figure to $1.47 billion and coincided with BTC hitting an annual high of $38,300.

The fund performed exceptionally well during the month, rising from $1.1 billion in AUM to $1.42 billion in the first ten days of November alone. While much of the appreciation was due to the increase in the price of BTC itself, Bloomberg ETF analyst Eric Balchunas said at the time that the roughly $240 million increase since early October was due to new real inflows.

Since its inception, BITO's average daily trading volume has been $160 million, placing it in the top 5% of all US ETFs.

Bitcoin investment funds attracted more capital last month, with total AUM rising to $32 billion. In addition to ProShares, investment products from Objective Investments — the owner of Canada's first bitcoin spot ETF — brought in $246 million this month.

Spot VS Future ETFs

Unlike the ProShares ETF, the Bitcoin Spot ETF backs stocks with the BTC held by the fund, not BTC futures contracts. This allows shares in the fund to track the value of bitcoin more accurately than a futures-based counterpart.

Shares in BITO, for example, are up just 79.94% year to date, while the benchmark Bitcoin CAD ETF (BTCC.B) is up 122%. Meanwhile, BTC itself rose 127%.

US regulators have yet to approve a bitcoin spot ETF, but recent developments have the market anticipating one coming in the next couple of months.

For example, many issuers such as BlackRock and Grayscale are in active discussions with the Securities and Exchange Commission (SEC) about how to market their ETFs.

Experts say that the bitcoin spot ETF will invite institutional capital to BTC, which was previously inaccessible for 1:1 investment in the asset. Until now, many aspiring portfolio managers have been forced to stick to peers like BITO, Coinbase (COIN), and MicroStrategy (MSTR).