Matt Hougan, Bitwise Chief Investment Officer In a new note, Matt Hougan provided a detailed analysis of early adopters of Bitcoin exchange-traded funds (ETFs) based on 13F filings with the SEC. His insights highlight the significant acceptance of Bitcoin ETFs by professional investment firms and portend a potential shift in the BTC investment landscape.
Since its launch on January 11, the Bitcoin ETF has amassed an impressive $11.7 billion in assets, making it the most successful ETF launch in the history of financial products. These explosive startups have sparked widespread interest in the identity of investors, primarily retail or professional.
Who Buys Spot Bitcoin ETFs?
Hougan’s memo provides a clear answer. “Many professional investors own Bitcoin ETFs,” he said. These are not just investors. They are some of the most respected and substantial asset managers in the industry. For example, Hightower Advisors, ranked the No. 2 RIA firm in the U.S. by Barron’s and manages $122 billion in assets, currently holds $68 million in Bitcoin ETFs. Likewise, Bracebridge Capital, a well-known Boston-based hedge fund that manages endowments of institutions such as Yale and Princeton, also invested a huge amount of $434 million.
Other significant stakeholders include Cambridge Investment Research with $40 million, Sequoia Financial Advisors with $12 million, Integrated Advisors with $11 million, and Brown Advisory with $4 million in Bitcoin ETF holdings. As of the latest data last Thursday, a total of 563 professional investment firms reported holding a total of $3.5 billion worth of Bitcoin ETFs. Hougan expects that number to grow to more than 700 companies and total assets approaching $5 billion by the May 15 filing deadline.
“This is truly massive,” Hougan explained. “For any financial advisor, family office or institution wondering if they are the only one considering exposure to Bitcoin, the answer is clear: You are not alone.”
From a historical perspective, the scale of professional investor ownership has been described as unprecedented. Bloomberg ETF senior analyst Eric Balchunas called the number of large investors involved in Bitcoin ETFs “freakish.” By comparison, when the gold ETF launched in late 2004 (previously considered the most successful launch of all time), it attracted more than $1 billion in just five days. However, the first 13F filing showed that only 95 professional firms were investing. In contrast, the Bitcoin ETF has dramatically exceeded this figure since its initial filing.
Despite this surge in professional interest, Hougan’s note cautions that a significant portion of the total $50 billion in assets under management in Bitcoin ETFs is still owned by retail investors. He estimates that professional investors currently account for only 7 to 10 percent of total assets. But he suggested that the media’s portrayal of these ETFs as “retail-focused” funds may be overlooking an important new trend.
“Most investors follow familiar patterns,” said Hougan, describing the typical four-stage investment trajectory observed at institutions. Initially, a due diligence period will last 6 to 12 months. This allows professionals to make small, personal allocations to test the waters before recommending a broader allocation to their clients. Ultimately, this is allocated across a more substantial platform, typically in the range of 1-5% of the portfolio, across the entire customer list.
Based on these insights, Hougan is “incredibly” optimistic about the future of Bitcoin ETFs. “The allocations seen in recent 13F filings are merely down payments,” he concluded. He highlighted that firms like Hightower Advisors, which currently holds a 0.05% allocation, could potentially increase their investments significantly. “Multiply this by the growing number of professional investors participating in this space and you can see what lies behind my passion.”
Surprisingly, after Hougan released his note yesterday, there was perhaps the most significant 13F disclosure for Bitcoin to date. The Wisconsin Investment Board reported purchasing $99,167,688 (2,450,400 shares) of BlackRock’s IBIT and $63,687,310 (1,013,000 shares) of Grayscale’s GBTC.
At press time, the BTC price was $61,940.
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