Grayscale Bitcoin Trust (GBTC) Catching Up Fast to Gold’s Largest ETF (GLD)
Bitcoin ETFs are also making waves, with BTCC doing three times more volume than any other ETF in Canada. Meanwhile, Bitcoin price, which is ready to hit $58k, is up 92% YTD compared to gold’s -5.83%.
Grayscale, the world’s largest digital assets manager, has $43.63 billion in assets under management. In less than a month, the asset manager has doubled its AUM as earlier this month it was sitting at $26.4 billion and $20.2 billion at the beginning of the year.
The majority of this AUM belongs to Grayscale's one product Bitcoin Trust (GBTC), which has $36.57 billion in assets under management. Grayscale Bitcoin Trust currently holds 455.47k BTC, just over 3.5% of Bitcoin’s circulating supply.
This is thanks to the price of Bitcoin hitting a new high above $57,000 today and becoming a trillion-dollar asset.
With this, Bitcoin has achieved 10% of gold’s market cap, with the precious metal’s market cap being around $10 trillion. Price-wise, gold is nowhere near in BTC’s realm. Spot gold is currently trading at $1,783 per ounce, as of writing, down 5.83% YTD compared to Bitcoin’s more than 90% gains in 2021 so far.
Just as the leading digital currency is slowly eating up gold’s market share, the biggest Bitcoin fund GBTC is closing in on the largest gold ETF, SPDR Gold Trust (GLD), which has $64.85 billion in assets under management.
“GBTC ($39.2b+) isn't that far from flippening the largest gold ETF, GLD ($64b),” tweeted Nic Carter of Coin Metrics.
The gold ETF that provides “physically held” exposure to the precious metal records $1.49 billion in average daily volume.
While Grayscale clearly dominates the market, an increasing number of funds are now making an appearance. Several organizations are filing for a Bitcoin ETF, allowing institutional investors exposure to the digital asset without actually buying or holding them.
While the US has yet to get one, Canada has already had two. This week, the Ontario Securities Commission (OSC) also approved the Evolve Funds Group’s application for a Bitcoin ETF.
As we reported, the first Bitcoin exchange-traded fund, Purpose Bitcoin ETF (BTCC), was a roaring success, beating the traditional numbers. The two-day AUM is estimated to be $330 million.
On Friday, BTCC traded $350 million, a jump of 40% from its debut day and three times more volume than any other ETF, noted Eric Balchunas, Senior ETF Analyst for Bloomberg. Joe McCann, a Microsoft strategist said,
“ETFs beget liquidity, and liquidity improves price discovery and price ascent. This is historic volume in Canada for its BTC ETF. When, not if, it gets approved in the US, we will see the same thing happen.”
The US Securities and Exchange Commission has shut down all the attempts to offer Bitcoin ETF in America, so far, but there are high expectations for one under the new SEC Chairman, for which President Joe Biden has nominated Gary Gensler, who taught a class on Blockchain at MIT.