Bitcoin ETFs could overtake gold ETFs in 2 years, analyst says

ETF Institute co-founder Nate Geraci believes that spot Bitcoin exchange-traded funds (ETFs) could surpass Gold ETFs in the next two years if the current trajectory continues. In an opinion shared on X, Geraci noted that Gold ETFs were launched in 2004, which means they have a 20-year headstart on Bitcoin ETFs.

According to available data, Gold ETFs presently have a cumulative flow of around $50 billion compared to Bitcoin ETFs with around $20 billion. Bitcoin products have only been around for ten months, and have put in strong performances in comparison with Gold.

Geraci said:

“20yr head start for gold ETFs, but wouldn’t be surprised to see bitcoin ETFs surpass them in next 2yrs.”

The analyst also noted that the performance of Bitcoin ETFs has surpassed the expectations of bullish supporters. It has also forced skeptics to adjust their positions about the ETFs constantly. Geraci mentioned that most critics initially said there would be no demand for the ETFs. Now, they have shifted their criticisms to say that inflows are because of hedge funds playing basis trade.

Bitcoin ETFs now have $21 billion in cumulative flows

Bitcoin net inflows reached $21 billion after a busy week that saw BlackRock IBIT alone get over $1 billion. According to Farside Investors data, the ETFs pulled in $2 billion collectively this week after five days of consecutive positive flows, ending with a $273 million net inflow for all ETFs, excluding Valkyrie BRR on Friday.

BlackRock IBIT was the biggest all week and still had $70 million on Friday, but Ark Invest ARKB led with $110 million, while VanEck HODL, Bitwise BITB, and Fidelity FBTC also pulled weight. Interestingly, the ETFs that performed best this week were IBIT and ARKB, with IBIT further entrenching itself as the leader now that its net inflows are at $23 billion.

The inflow of funds into Bitcoin ETFs this week is likely due to demand from multiple fronts. For instance, Morgan Stanley increased its Bitcoin ETF exposure to $272.1 million this week, and more liquidity will soon come in. As Geraci said, “Demand is coming from everywhere.”

More liquidity and investors incoming as SEC approves more BTC ETF options

Meanwhile, Bitcoin ETFs could see an influx of new funds and investors after the Securities Exchange Commission (SEC) approved the NYSE and CBOE applications to list options for trading spot Bitcoin ETFs on their exchanges.

According to Bloomberg ETF analyst Eric Balchunas, approval was expected given that the SEC had already approved a similar one from Nasdaq.

He said:

“They approved same thing for Nasdaq recently, so not a big surprise but still good news as SEC was big hurdle. We are hearing good things about the rest of the process.”

However, he noted there are no details yet on when the options will be listed. When they do, all the 11 ETFs will have options trading as opposed to only IBIT, which currently enjoys it through Nasdaq. Experts believe this will attract more liquidity and investors and make the spot Bitcoin ETF ecosystem more robust,

In an episode of Thinking Crypto, Geraci said:

“In terms of the potential impact here, I think that options trading on spot Bitcoin ETFs is decidedly good. Because all options trading is going to do is deepen the liquidity around spot Bitcoin ETFs.”

Meanwhile, Bitcoin continues to see positive performance, although it has been unable to break into $69,000. The flagship asset got close to doing that when it reached $68,969. It has since retracted to $68,320.

With its performance, Bitcoin dominance has now surpassed 65% for the first time since 2021, marking a three-year high, according to IntoTheBlock.