The market share of Grayscale's spot Bitcoin exchange-traded fund (ETF) has dipped below 50% for the first time since its launch in the United States on January 11. Data from Dune Analytics indicates that as of March 12, the total assets under management (AUM) of the Grayscale Bitcoin Trust Fund (GBTC) have declined to $28.5 billion, with Grayscale currently holding 48.9% of the total assets of 10 US Bitcoin ETFs, which collectively amount to $56.7 billion. On the debut day of trading for these 10 US spot Bitcoin ETFs, Grayscale's funds accounted for approximately 99.5% of their total AUM.
Continuous outflows from GBTC, averaging $329 million per day over the past week, have contributed to the decline in the ETF's market share. The largest outflows from GBTC occurred in the initial month following the launch of the Bitcoin ETF, with over $7 billion exiting the fund in just over a month. However, outflows slowed towards late January, leading some analysts to speculate that the trend might be nearing its end.
Nevertheless, outflows from GBTC picked up once more in mid-February after a bankruptcy court permitted cryptocurrency lender Genesis to liquidate approximately $1.3 billion worth of GBTC shares as part of efforts to reimburse investors. Total outflows from GBTC have now surpassed $11 billion, according to Farside Bitcoin ETF flow data.
Originally established as a trust allowing institutional investors to access Bitcoin by locking up funds for at least six months, Grayscale's ETF transitioned following a court victory against the SEC in August and regulatory approval of other spot Bitcoin ETF applications. This shift enables institutional investors to permanently withdraw their funds from the GBTC or transfer their assets into lower-fee Bitcoin ETFs.
Despite initial market concerns over increased outflows from GBTC, optimism has been fueled by rising net inflows into BlackRock's iShares Bitcoin ETF (IBIT) and Fidelity Wise Origin Bitcoin Fund (FBTC), both of which have collectively attracted $16.9 billion worth of inflows since their inception. Some market observers attribute the rapid appreciation of Bitcoin prices, reaching an all-time high of $72,900 on March 11, to the increasing inflows into the nine newly launched ETFs. Currently, BlackRock's funds hold slightly over 200,000 BTC, valued at approximately $14.3 billion based on current prices, according to K33 Research.
