Happy New Year, Advisors! We look forward to bringing you crypto news for advisors every Thursday this year!
In today’s issue, our first newsletter of 2025, Roxanna Islam from TMX VettaFi offers a comprehensive guide to the world of crypto ETFs, looking at what happened in 2024 and what’s expected in 2025.
Than, Griffin Kelly from The Daily Upside answers questions about ETFs in Ask an Expert.
In the broader crypto industry, exchange-traded funds (ETFs) have faded somewhat into the background as other tailwinds (e.g. a potential strategic bitcoin reserve, increased interest in tokenization, and a greater intersection between energy and crypto) take center stage to stand. But for advisors, retail investors and many institutional investors, ETFs are our bridge from TradFi to DeFi and will remain a relevant part of the digital asset story in 2025. If innovation in crypto is expected to continue, so will the crypto ETF ecosystem. also continue to grow. Here’s what crypto ETFs stood for in 2024 and what we should look out for in 2025.
To put the impact of crypto ETFs into perspective, here are some interesting numbers from 2024 (YTD through December 26):
ETFs generated net inflows of more than $1 trillion in 2024. Of the nearly 4,000 ETFs, the iShares Bitcoin Trust (IBIT) had the third highest inflows ($37.2 billion), behind broad, large-cap U.S. ETFs the Vanguard S&P 500 ETF (VOO). and the iShares Core S&P 500 ETF (IVV).
The iShares Bitcoin Trust (IBIT) has $52.7 billion in assets – more than the iShares Gold Trust (IAU), which has only $33.0 billion in assets. IBIT is now the 35th largest US ETF.
The Fidelity Wise Origin Bitcoin Fund (FBTC) is now Fidelity’s largest ETF by assets – at over $19.6 billion. The second largest Fidelity ETF is the Fidelity Total Bond ETF (FBND), with $16.6 billion.
Excluding leveraged ETFs, the Grayscale Bitcoin Trust ETF was the second best performing ETF (up 145.4% YTD).
In 2024, there were 43 crypto ETF launches (including conversions). With around 77 US crypto ETFs, that means more than half of the universe launched this year.
About half of the 43 crypto ETFs launched were spot ETFs; twelve were Bitcoin and nine Ether ETFs.
Twelve of the newly launched ETFs were leveraged ETFs and five were option income ETFs. The remaining five were a mix of hedged stocks, crypto stocks and multi-asset ETFs.
Five single-stock Microstrategy (MSTR) ETFs are not included in this total number, but are still relevant.
Looking ahead to 2025, several ETF applications are already in various stages of approval. With the new crypto-friendly US administration (including a change in SEC leadership), issuers are filling the pipeline with potential new products. There will probably be three main areas to look at.