The ProShares Bitcoin Strategy ETF (BITO) has experienced a surge in inflows, with institutional investors showing renewed interest in Bitcoin futures. The fund, which was the first Bitcoin-linked ETF in the United States, saw its largest weekly inflow in a year, totaling $65.3 million.
It now has assets exceeding $1 billion and is popular among institutional investors. The BITO fund has closely tracked Bitcoin’s performance, lagging behind spot prices by only 1.05% annually and charging a fee of 0.95%. Since the start of 2023, the fund has gained 59.6%. The increased interest in Bitcoin derivatives has also been observed in Bitcoin futures open interest, which has risen by approximately 30% since the previous week, reaching $319 million.
This resurgence in ETF trading has positively impacted Grayscale, the world’s largest crypto asset manager, as the discount of its Grayscale Bitcoin Trust (GBTC) to spot BTC prices has diminished. The Grayscale premium, or discount, currently stands at -31.2%, compared to a low of -49% in December.
Although it is uncertain whether the Securities and Exchange Commission (SEC) will approve a spot Bitcoin ETF, a new wave of filings has emerged following BlackRock’s application. WisdomTree and Invesco have both filed or renewed their applications for a spot Bitcoin ETF. ETF Store President Nate Geraci believes that other issuers such as First Trust, VanEck, Global X, Fidelity, and Schwab may also file or refile for a spot Bitcoin ETF based on past filings.
