Investors' appetite for Bitcoin exchange-traded funds (ETFs) remains strong even as the US Securities and Exchange Commission (SEC) remains cautious as recent outflows hit the market.
Bitcoin ETF flows
According to SoSoValue data, the US-based spot Bitcoin ETFs experienced significant outflows over the past four days, totaling $1.2 billion.
On Jan. 14, the 12 spot ETFs lost a combined $209.82 million, with BlackRock's IBIT fund seeing the largest outflows of $219.48 million in assets. This is the fund's second-largest negative flow since its launch a year ago, behind the record $332 million outflow it registered earlier in the year.
Meanwhile, Bitwise's BITB was the second ETF product to record outflows, with $8.93 million exiting the fund.
However, not all funds experienced losses. WisdomTree's BTCW posted a net inflow of $10.24 million, while VanEck's HODL and ARK 21Shares' ARKB funds added $5.46 million and $2.89 million, respectively.
SEC delays Bitwise
The significant outflows come as the US Securities and Exchange Commission (SEC) extended its review of Bitwise's proposal to launch a broad-based crypto index ETF. A new decision deadline has been set for March 3.
The SEC explained that the delay allows for a more detailed review of the proposal, which could mark a significant milestone in the industry.
The application was submitted in November 2024 and published for public comment in December. While no comments have been recorded yet, the regulator remains cautious about the broader implications of such products.
According to the filing:
“The Commission finds it appropriate to designate a longer period within which to take action on the proposed rule change so that it has sufficient time to consider the proposed rule change and the issues raised therein.”
The proposed ETF would track the performance of the 10 largest cryptocurrencies by market capitalization, including Bitcoin, Ethereum, and Solana.
Osprey moves to convert fund
Despite these prevailing market situations, Osprey Funds has announced plans to transition its Bitcoin trust into an ETF.
According to a Jan. 14 statement, Osprey intends to file with the SEC soon to facilitate the conversion.
Osprey Bitcoin Trust (OBTC) was launched in February 2021 and provides investors with Bitcoin exposure while eliminating the complexities of direct ownership. As of Jan. 14, the fund manages $186.65 million in assets.
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