Asset managers across various sectors, including wealth management firms, hedge funds, and pension funds, significantly increased their investments in U.S. exchange-traded funds tied to the price of bitcoin in the last quarter of 2024. This surge in allocations comes as the price of bitcoin, the world’s largest cryptocurrency, experienced a remarkable 47% surge in value.
According to recent regulatory filings, the State of Wisconsin Investment Board revealed a substantial increase in its bitcoin ETF holdings, which more than doubled to 6 million shares of the iShares Bitcoin Trust ETF by the end of December. This fund was among the first to venture into crypto investments following the introduction of bitcoin ETFs.
Other prominent investment funds also ramped up their positions in these ETFs, which were launched in January 2024. Tudor Investment Corp, a systematic hedge fund manager, reported a significant increase in its holdings of the iShares ETF, now the largest in the group with over $55 billion in assets. The fund’s holdings soared to 8 million shares from 4.4 million shares, reflecting a substantial increase in value to $426.9 million by the end of the year.
Additionally, Abu Dhabi’s sovereign wealth fund, Mubadala Investment Co, made its debut in bitcoin ETFs during the fourth quarter, acquiring an 8.2 million share stake in the iShares ETF valued at $436.9 million. Hedge fund Hunting Hill Capital also re-entered the ETF market, with positions valued at approximately $131 million by the end of December, after having no exposure in the previous quarter.
Financial advisory firms like Cetera Advisors and NewEdge Advisers were among those who bolstered their holdings in various ETFs, including offerings from Fidelity, ARK Investments, and Invesco. Cresset Asset Management, on the other hand, opted for ETFs with lower fees, citing the availability of attractive options pricing for collar strategies to protect against downside risk while capturing less of the upside potential in these bitcoin funds.
The 13F filings provide valuable insights into institutional investors’ positioning at the close of each quarter, although these positions may not necessarily reflect current holdings. As the interest in bitcoin ETFs continues to grow among asset managers, it remains to be seen how these investments will fare in the volatile cryptocurrency market.
The original article was reported by Suzanne McGee and edited by Leslie Adler, providing a comprehensive overview of the increasing trend of asset managers allocating funds to bitcoin ETFs.
