US Bitcoin ETFs Amass Over Half of Gold’s Holdings in First Year

U.S.-listed Bitcoin exchange-traded funds have rapidly accumulated tens of billions in assets, reaching half that held by gold ETFs in record time.

Since launching in January 2024, Bitcoin ETFs have attracted substantial inflows, totaling $23.89 billion and $70 billion in total net assets, per data from SoSoValue.

By comparison, total net assets for U.S.-listed gold ETFs stand at $137.3 billion, according to the latest figures from the World Gold Council.

That means that in just 10 months, spot Bitcoin ETFs have amassed over 50% of the assets held by gold ETFs, which have been around for two decades, Nate Geraci, president of The ETF Store, tweeted Thursday.

The rapid adoption of Bitcoin ETFs reflects the quickening of mainstream interest in digital assets, according to some, with recent daily inflows ranging from $192 million to as much as $893 million.

“There is no question that the BTC ETFs have been well received, breaking all inflow records as they go,” Ryan McMillin, chief investment officer at crypto fund manager Merkle Tree Capital, told Decrypt. 

In comparison, gold ETFs, which debuted in 2004, have long represented a stable hedge against market volatility and inflation.

“It is hard to compare absolute flows as 20 years between launches include a lot of inflation,” McMillin added. 

The assets are often compared for their roles as "safe havens," with gold prized for its historical stability and Bitcoin increasingly seen as a digital counterpart due to its finite supply and independence from traditional financial systems.

Jurrien Timmer, director of Global Macro at Fidelity Investments, often characterizes Bitcoin as "exponential gold," highlighting its rapid adoption curve and inherent scarcity. 

His perspective suggests Bitcoin's value proposition extends beyond that of traditional "digital gold," instead emphasizing its potential as a store of value driven by network growth and limited supply.

Whatever the case, Bitcoin has emerged as the best-performing asset of 2024, climbing 65% year-to-date to $69,533. Gold has also demonstrated strong performance, with prices up 16% to $2,746.09 per ounce.

Despite the world’s largest asset dipping more than 4% on Thursday, McMillin still sees Bitcoin finishing off the year strong.

“We’ve seen a few sell-offs, which could be larger funds reweighing their portfolios to take some gains, or it could very likely be a little volatility as we get closer to the US election,” he said.

“I wouldn’t expect we go much lower here, not without a serious catalyst,” McMillin added.