Bitcoin ETFs Edge Closer to Gold in Assets as Institutional Demand Grows
2024 has been a pivotal year for digital assets, especially bitcoin (BTC), thanks to increasing institutional adoption. This shift has been driven by two key factors: bitcoin being integrated into corporate balance sheets as a treasury asset and the rise of U.S.-listed bitcoin exchange-traded funds (ETFs), which have collectively amassed over 1 million BTC.
K33 Research reports that U.S.-listed bitcoin ETFs have now surpassed gold ETFs in total assets under management (AUM), including leveraged futures-based ETFs. As of December 17, the AUM for bitcoin ETFs reached $129.25 billion, just ahead of gold ETFs’ $128.88 billion, according to Vetle Lunde, an analyst at K33 Research.
However, when considering only spot-based ETFs, gold still has a slight lead. Senior Bloomberg ETF analyst Eric Balchunas notes that U.S. bitcoin spot ETFs currently hold $120 billion in AUM, compared to $125 billion for gold ETFs.
Strong CME Activity Signals Growing Institutional Interest
The CME, a major exchange for institutional traders, continues to show strong activity, with futures open interest climbing toward new highs, currently at 212,635 BTC in open contracts. The basis trade premium has surged to 16.4%, the highest level since November 2023, signaling that traders expect increased momentum in the market.
The widening contango—where January contracts are trading at a 1.5% premium over December contracts—also highlights bullish sentiment, with the January premium reaching its highest level since November. The December contract remains the most valuable, with open interest equal to 113,480 BTC. The upcoming December roll is expected to be significant, with several upcoming banking holidays likely contributing to further widening of the January premium.
U.S.-listed bitcoin ETFs have seen consistent inflows since November 27, with net inflows totaling $6.5 billion, according to Farside data. Many of these inflows are part of the cash-and-carry trade strategy, as the basis trade premium continues to rise and open interest grows on the CME.
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