Gold ETFs Experience Outflows as Bitcoin ETFs Attract Billions

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According to CoinDesk, since the launch of 10 spot bitcoin ETFs on January 11, gold ETFs have seen significant outflows, while bitcoin ETFs have attracted huge inflows. The two largest spot bitcoin ETFs, BlackRock's IBIT and Fidelity's FBTC, have amassed nearly $10 billion in assets under management (AUM) in just over a month. In contrast, the two largest gold ETFs, the SPDR Gold Shares (GLD) and the iShares Gold Trust (IAU), have experienced net outflows. From January 11 to February 14, investors withdrew approximately $2.6 billion from GLD and about $507 million from IAU.

This trend differs from the same period last year when both gold funds saw solid inflows, with GLD attracting around $241 million and IAU $86 million. Out of 14 gold ETFs analyzed on, 11 have experienced net outflows since the beginning of the year. Including outflows at Grayscale's GBTC, the spot bitcoin ETFs as a group have seen roughly $5 billion in net inflows. Bloomberg Intelligence senior ETF analyst Eric Balchunas commented on the situation, stating that it is a 'pretty bad scene' in the gold ETFs category. However, he does not believe that investors are necessarily migrating from gold to bitcoin ETFs.

Bitcoin is often compared to gold as both are considered haven assets by investors seeking protection from inflation and government intervention. The launch of spot bitcoin ETFs has made it easier for people outside the crypto industry to invest in bitcoin, which has been around for a much shorter time than gold's 5,000-year history. Performance may also be a factor, as gold's price has decreased by over 2% in 2024, while bitcoin has increased by 23% year-to-date.