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Introduction
The approval and launch of spot Bitcoin exchange-traded funds (ETFs) in the US have been among the most anticipated financial products of recent years. With a total net asset value of $129 billion as of 2024, it’s clear that these products are poised to make a significant impact on the market.
What are Spot ETFs?
Spot Bitcoin ETFs are financial products that reflect the value of their underlying assets. Regulated, transparent, and highly liquid, they provide investors with access to assets they might otherwise be unable or unwilling to hold directly. This format is especially appealing for cryptocurrencies, as it offers a regulated, widely accessible, tax-efficient investment option.
History of Spot Bitcoin ETF Applications
Since 2013, the US Securities and Exchange Commission (SEC) has consistently rejected all spot Bitcoin ETF applications. Firms such as VanEck, WisdomTree, Bitwise, ARK Invest, 21Shares, and Grayscale faced repeated refusals.
The Approval of Futures-Based Bitcoin ETFs
In 2021, the SEC approved futures-based Bitcoin ETFs, with ProShares’ BITO being the first to launch. Initially a success, it reached $1 billion in assets within just two days. However, investors’ interest in BITO declined quickly, with its assets under management (AUM) dropping from a peak of $1.4 billion to $500 million within a year.
The Limitations of Futures-Based ETFs
Futures-based ETFs, while allowing their holders to profit from Bitcoin price movements, lack the efficiency of spot ETFs, which hold actual BTC. Furthermore, spot ETFs create immediate buying or selling pressure, directly influencing Bitcoin’s price and liquidity.
The Success of Spot Bitcoin ETFs in 2024
In the world of ETFs, the spot Bitcoin ETFs quickly became a phenomenon. From the outset, the nine new ETFs (excluding Grayscale and Hashdex) shattered many industry records, generating $2.2 billion in trading volume on the first day, with the iShares Bitcoin Trust ETF (IBIT) alone accounting for $1 billion.
Inflows Show Spot BTC ETF Was a Success
According to data from Farside, the ETFs have already attracted $1.1 billion in net inflows year-to-date as of 2025. This demonstrates that interest in spot Bitcoin ETFs remains strong, even amid a market correction.
The Rise of Ether ETFs
Ether (ETH), the second-largest cryptocurrency by market capitalization, entered the ETF space with the launch of its first dedicated spot ETFs in July 2024. However, their performance was more subdued compared to Bitcoin’s. Starting with $8.8 billion from the Grayscale Ethereum Trust, their total AUM grew modestly to $11 billion by year-end.
Will More Crypto ETFs Launch in 2025?
The start of 2025 shows that interest in spot Bitcoin ETFs remains strong, even amid a market correction. According to Farside, the ETFs have already attracted $1.1 billion in net inflows year-to-date. As Bitcoin continues to gain recognition in political and financial circles, this momentum could persist and maybe even expand to other cryptocurrencies.
Conclusion
The rise of spot Bitcoin exchange-traded funds (ETFs) in the US is a significant development that has the potential to revolutionize the way investors interact with cryptocurrencies. With a total net asset value of $129 billion as of 2024, these products are poised to make a lasting impact on the market.
Future Developments
The possibility of a spot Solana (SOL) ETF has become a hot topic in the crypto community, with Polymarket users assigning a 74% probability of an SOL ETF being approved in 2025. The chances of an XRP ETF are estimated at 70%. VanEck, 21Shares, and Canary Capital have already filed for such ETFs.
Vanguard’s Potential Entry into Crypto
Vanguard, one of the world’s largest investment management firms, has so far resisted entering the crypto game. However, with the departure of its outspoken anti-Bitcoin CEO Tim Buckley and the arrival of former BlackRock executive Salim Ramji last summer, the narrative could shift following the launch of a crypto ETF.
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Note: This article does not contain investment advice or recommendations. Every investment and trading move involves risk, and readers should conduct their own research when making a decision.