Bitwise anticipates record inflows into American spot Bitcoin 
$75,013 ETFs in the fourth quarter, with projections indicating that fund flows might surpass the total for 2024 by the end of the year. Matt Hougan, Bitwise’s Chief Investment Officer, highlighted in a note sent to clients on Tuesday night that the acceleration in investment advisor approvals and the narrative surrounding erosion in cash-like assets are key drivers. He emphasized that the recent double-digit price increase earlier in the month has renewed interest, with media visibility further fueling demand. Current data shows a net influx of $3.5 billion into Bitcoin ETFs over the first four trading days of the quarter, with an additional $875.6 million entering on Tuesday, the last trading day.
Factors Boosting Q4 Expectations for Bitcoin
Hougan indicated that formal authorizations within investment advisor channels have opened the door for heightened demand. Among developments in this sector is Morgan Stanley’s publication of thresholds framing cryptocurrency allocation within multi-asset portfolios. The financial services giant recommended a 0% allocation for cautious portfolios and a 2–4% allocation for those with a higher risk appetite. Wells Fargo is paving the way for advisors to access Bitcoin ETFs, while UBS and Merrill Lynch are also anticipated to take similar steps. Despite gradual approval processes within large networks, professionals that Bitwise engaged with in recent months point to strong demand waiting in the wings.
The narrative of erosion in value is also nurturing market momentum. The 44% increase in money supply since 2020 and JPMorgan’s evaluations have brought this discourse into the mainstream, highlighting gold and Bitcoin for year-end portfolio reviews. As gold and Bitcoin emerge as top-performing major assets this year, investment advisors are increasingly motivated to allocate towards these assets as the year closes.
Dynamics of Fund Flows into ETFs
The historical connection between price momentum and ETF inflows strengthens expectations. Bitcoin’s 9% rise at the month’s start took its price above $126,000, followed by a slight pullback to $121,600. Bitwise noted that every quarter exhibiting double-digit returns saw ETF inflows reaching billion-dollar magnitudes.
Encouraging fund flow data support this optimism. Following the $3.5 billion fund inflow over the month’s first four trading days, another $875.6 million was added on Tuesday. BlackRock’s IBIT led with $899.4 million. Monday’s $1.21 billion daily inflow marked the highest volume since the post-U.S. presidential election period in November last year. Hougan added that ETF inflows have crossed $25.9 billion since the year’s start, suggesting that with 64 days left in the year, reaching the $10 billion mark should be easily achievable by year-end.
