The chief investment officer of crypto fund manager Bitwise believes that spot Bitcoin (BTC) exchange-traded funds (ETFs) will receive inflows for years to come.
Bitwise CIO Matt Hougan tells his 40,700 followers on the social media platform X that there remains a large pool of clients who have yet to invest in BTC ETFs but will likely do so in the future.
“ETF flows will continue for years: a good question to ask about the new Bitcoin ETFs is whether the incredible inflows we’ve seen in the first two months represent a one-time surge or are indicative of long-term sustained demand. After my time on the road, I’m convinced that the latter is the case.
That’s because there is a massive dispersion in the pace of adoption of Bitcoin ETFs. I met financial advisors who have already allocated 3% for all their clients and others who haven’t started thinking about it. I spoke with national account platforms that are approving Bitcoin ETFs this month and others that are eyeing mid-2025.
The truth is, most professional investors still cannot buy Bitcoin ETFs. That will change through a series of 100+ individual due diligence processes over the next two years.”
However, he believes Bitcoin ETFs will see quicker adoption than gold ETFs did.
“Inflows into the gold ETFs built year-after-year for their first seven years in the market. I suspect the Bitcoin ETF ramp will be shorter, but it will still take years.”
The analyst also predicts that the Bitcoin ETFs will increase confidence in the digital asset and prompt investors to boost the percentage size of their portfolio stakes in the crypto king.
“3% is the new 1%: I’ve been speaking with professional investors about Bitcoin since 2018. For the past six years, the discussion has mostly focused on a 1% allocation. That’s the most that most investors would think about. Boy has that changed. Almost every investor I’ve spoken with has talked about a 3%+ allocation.
The primary reason in my honest opinion is that the launch of ETFs has de-risked the downside of Bitcoin. Before, people were worried Bitcoin could go to zero. In that world, a 1% allocation is all you can stomach. But if ‘going to zero’ is off the table, 3% or 5% starts to make more sense.”
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