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Spot Bitcoin ETFs listed in the U.S. are edging closer to surpassing Gold ETFs in assets under management (AUM), marking a pivotal moment in the history of digital assets. As of December 17, Bitcoin ETFs boast $129.25 billion in AUM, narrowly overtaking Gold ETFs at $128.88 billion, according to K33 Research.
With institutional adoption of Bitcoin accelerating, the landscape of investment portfolios is transforming, positioning Bitcoin ETFs as formidable contenders against the traditional allure of Gold.
While Bitcoin ETFs have surged ahead in total AUM, spot-based products tell a slightly different story. Senior Bloomberg ETF Analyst Eric Balchunas explains: U.S. Bitcoin spot ETFs currently manage $120 billion, while Gold ETFs hold a slight lead at $125 billion.
This nuanced comparison underscores the growing traction of Bitcoin in areas traditionally dominated by Gold.
The Chicago Mercantile Exchange (CME) remains a stronghold for institutional Bitcoin trading. Futures open interest on CME hit near-record levels, with 212,635 BTC in contracts.
The basis trade premium—an indicator of expected price momentum—has surged to 16.4%, the highest since November 2023. January contracts are also trading at sharp premiums relative to December, reflecting optimism for Bitcoin’s future.
The report by K33 Research notes:
The December roll is expected to be significant, influenced by upcoming banking holidays, which could further widen the January premium.
Bitcoin ETFs have enjoyed consistent net inflows since November 27, 2024, totaling $6.5 billion, according to Farside data. These inflows are largely attributed to the cash and carry trade, driven by the widening basis trade premium.
Balchunas remarks: This sustained momentum highlights the growing confidence in Bitcoin ETFs as an alternative to traditional assets like Gold.
The appeal of Bitcoin ETFs lies in their accessibility, liquidity, and potential for growth. Unlike Gold, Bitcoin represents a digital-first asset class that resonates with the modern investor.
The competition between Bitcoin ETFs and Gold is far from over. Analysts predict that Bitcoin’s edge in innovation and adoption could further tilt the scales.
Lunde believes: Bitcoin ETFs have the potential to redefine the global financial ecosystem. If current trends persist, 2025 could solidify Bitcoin’s dominance over Gold as a store of value.
Institutional activity on the CME is a critical factor driving Bitcoin ETFs’ success. The futures market not only provides liquidity but also signals confidence among sophisticated investors.
K33 Research emphasizes the importance of this activity: Futures-based ETFs and the CME are integral to the long-term viability of Bitcoin ETFs. Their sustained growth highlights the robust demand for Bitcoin as an institutional-grade asset.
The rise of Bitcoin ETFs vs Gold represents more than just a battle between two asset classes—it signifies a broader evolution in investor priorities. As digital assets gain mainstream acceptance, traditional assets like Gold may face increasing competition for relevance.
In 2024, the debate around Bitcoin ETFs and Gold is shaping up to be one of the most critical discussions in finance. The question remains: will Bitcoin ultimately dethrone Gold as the ultimate safe haven asset?
As the year draws to a close, the narrative of Bitcoin ETFs vs Gold continues to captivate investors and analysts alike. With Bitcoin ETFs surpassing Gold in total AUM and CME activity indicating sustained institutional interest, the stage is set for a transformative 2025.
Gold may retain its status as a timeless asset, but Bitcoin’s digital-first advantages are proving irresistible to a new generation of investors. The power struggle between these two asset classes is far from over, but one thing is clear: Bitcoin ETFs are no longer the underdog.
By embracing the innovations of Bitcoin and leveraging the stability of Gold, investors can navigate the evolving financial landscape with confidence. Get more from The Bit Gazette
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