Violet Vallaya
Eric Balchunas, an ETF analyst at Bloomberg, highlighted that April 30 is anticipated to mark the point where the quantity of BTC held in Blackrock’s IBIT ETF surpasses that of rival Grayscale’s GBTC ETF.
IBIT (iShares Bitcoin Trust) and GBTC (Grayscale Bitcoin Trust) are both ETFs (Exchange-Traded Funds) that provide exposure to Bitcoin but with key differences. Launched in January 2024, IBIT offers a lower expense ratio compared to GBTC, which has been around since 2013. This fee disparity has led to a surge in assets for IBIT, while GBTC faces outflows. As a result, the once-unmatched GBTC is in a race to hold onto its crown.
Currently, GBTC maintains a lead over its closest competitor IBIT, with a margin of $2.3 billion, as noted by Balchunas. He further indicated that this timeline could potentially be accelerated should there be a significant surge in the price of Bitcoin.
Here’s what you need to know:
- The Battle: Grayscale’s GBTC product has been a popular choice for investors seeking exposure to Bitcoin. However, its high management fee has drawn criticism. In contrast, BlackRock’s IBIT offers a more reasonable fee structure, making it an attractive alternative.
- Inflows and Outflows: Investors closely monitor the inflows and outflows of these two products. Currently, GBTC holds a lead over IBIT by $2.3 billion. However, recent trends indicate a shift. In the past few days, inflows to IBIT have decreased, while outflows from GBTC have increased.
- The Flippening: Balchunas refers to the potential event as the “flippening.” This term is also used hypothetically when Ethereum will surpass Bitcoin in market capitalization. If all goes as predicted, April 30 will mark the moment when IBIT’s assets exceed those of GBTC.
- Market Impact: The outcome of this battle could signal whether the market is leaning bullish or bearish. A major rally in Bitcoin’s price could accelerate the date of IBIT’s victory, as per Balchunas.
