ETF Inflows Reveal Unclear Institutional Demand in Crypto Market

Billions are flowing back into Bitcoin exchange-traded funds (ETFs), but it's unclear how much of that demand comes from institutional investors, according to CoinShares.

CoinShares head of research James Butterfill told Cointelegraph that US crypto investment products attracted about $4.1 billion in September, with BlackRock’s iShares Bitcoin Trust ETF (IBIT) accounting for more than 53% of those inflows.

When asked whether institutional investors were returning to crypto, Butterfill said, 'Potentially yes, but in the ETF world it is very difficult to disaggregate institutional and retail money.'

Butterfill noted that buying shares of a spot Bitcoin ETF while shorting Bitcoin futures can be an attractive strategy, known as the basis trade, which has an attractive yield at 6%.