• Investment advisors increased their Spot BTC ETF holdings by 3% to 9% in Q2 2024.
  • Hedge fund investments in BTC ETFs declined as funds shifted to BTC futures.
  • Despite the dip in BTC price, the ETFs saw $2.4 billion in net inflows from institutional investors.

Investment advisors have significantly increased their holdings in Spot Bitcoin ETFs during the second quarter of 2024, while hedge fund investments have slightly declined, according to a recent Coinbase report.

The proportion of institutional investment in Spot Bitcoin ETFs by investment advisors rose by 3% in Q2 2024. Investment advisors now hold 9% of total institutional investments in these ETFs. This data pertains to firms managing over $100 million in assets, which are required to file the 13-F form with the US Securities and Exchange Commission (SEC).

Coinbase anticipates this trend will continue as more brokerage houses complete their due diligence on these funds. The rise in advisor holdings follows a report that Morgan Stanley has authorized its 15,000 financial advisors to recommend spot Bitcoin ETFs to high-net-worth clients. 

Moreover, Coinbase notes that significant inflows into these ETFs might be delayed due to the summer slowdown in the US. Since July 18, Bitcoin’s price has dropped nearly 8.27% currently trading at $59,172 at the time of writing.

Hedge Funds Shift Focus to Futures as Bitcoin ETFs Attract Inflows

In contrast, Hedge fund managers have decreased their holdings in Bitcoin ETFs. This is due to their focus on exploiting price differences between Bitcoin futures and ETFs. The Chicago Mercantile Exchange (CME) saw a 15% increase in Bitcoin futures contracts during Q2 2024, reaching $2.75 billion.

Despite the overall market downturn, the ETF complex saw $2.4 billion in net inflows from institutional investors in Q2. BTC’s price fell from an all-time high of $71,333 on April 1 to $60,888 by June 30, declining about 14.6% for the quarter.

Since the launch of spot Bitcoin ETFs on January 11, 2024, net inflows have totaled $17.35 billion, highlighting continued institutional interest despite market fluctuations.

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