$1.9bn poured into Bitcoin ETFs but will momentum last?

The recent flurry of investment into newly launched US bitcoin exchange-traded funds (ETFs) has impressed, with over $1.9 billion flowing into the vehicles in their first 3 trading days. But now talk is turning to whether this momentum can be maintained long-term.

The 9 ETFs tracking the spot price of bitcoin debuted on January 11th after receiving the green light from American regulators. Data shows that asset management titans BlackRock and Fidelity attracted the most inflows, pulling in over $700 million and $500 million respectively into their Bitcoin trusts.

This strong initial interest has led some optimistic analysts to predict potential total inflows reaching $50-$100 billion by year’s end. However, others caution that it remains unclear whether these new ETFs can retain such stellar demand from retail and institutional investors alike.

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Their long term trajectory relies on uptake not just from individuals but crucially institutional players too, like pension funds who are yet to fully embrace crypto ETFs as an investable asset class.

With bitcoin still suffering from recent price volatility, the durability of inflows also hangs in the balance. As such the industry will be watching closely in months ahead whether these vehicles can transition from short-term crypto craze to established investment portfolio fixture.