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, TMX VettaFi’s Roxanna Islam provides a comprehensive guide to the world of crypto ETFs, looking at what happened in 2024 and what’s expected in 2025.
Next, The Daily Upside’s Griffin Kelly answers questions about ETFs on Ask an Expert.
-Sarah Morton
Crypto ETFs – Review of 2024 and why they are still important in 2025
In the broader crypto sector, exchange-traded funds (ETFs) have taken a somewhat back seat as other tailwinds (e.g., a potential strategic reserve of Bitcoin, increased interest in tokenization, and a largest intersection between energy and cryptography) are taking center stage. But for advisors, retail investors, and many institutional investors, ETFs are our bridge between TradFi and DeFi and will remain an important part of the digital asset story in 2025. If the As innovation in crypto continues, so will the crypto ETF ecosystem. also continue to grow. Here’s where crypto ETFs stood in 2024 and what to watch for in 2025.
2024: the big impact of Bitcoin in ETFs
To put the impact of crypto ETFs into perspective, here are some interesting figures for 2024 (year-to-date until December 26):
- ETFs generated over $1 trillion in net inflows in 2024. Of nearly 4,000 ETFs, the iShares Bitcoin Trust (IBIT) saw the third largest inflow ($37.2 billion) after ETFs US large-cap stocks, 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, with over $19.6 billion. The second largest Fidelity ETF is the Fidelity Total Bond ETF (FBND), at $16.6 billion.
- Excluding leveraged ETFs, the Grayscale Bitcoin Trust ETF was the second best-performing ETF (up 145.4% year-to-date).
- In 2024, there were 43 crypto ETF launches (including conversions). With around 77 US crypto ETFs, that means more than half of the universe has launched this year.
- About half of the 43 crypto ETFs launched were spot ETFs: twelve were Bitcoin ETFs and nine were Ether ETFs.
- Twelve of the newly launched ETFs were leveraged ETFs and five were options income ETFs. The other five were a mix of hedged stocks, crypto stocks, and multi-asset ETFs.
- Five single-stock microstrategy ETFs (MSTRs) are not included in this total count but are still relevant.
2025: the innovation of crypto ETFs to come
Looking ahead to 2025, several ETF filings are already at various stages of approval. With the new crypto-friendly US administration (including a change at the helm of the SEC), issuers are filling the pipeline with potential new products. There will likely be three main areas to watch.
First, there is the possibility of creating more spot ETFs beyond Bitcoin and Ether. VanEck, 21Shares and Canary Capital have filed for crypto ETFs, including Solana and XRP spot ETFs. Canary Capital also filed a Litecoin ETF and an HBAR ETF.
Additionally, there will be new innovations in the way digital assets are packaged in ETF packaging. These include deposits of several crypto index ETFs (multi-token funds). One of the proposed funds is the Bitwise Bitcoin and Ethereum Fund, which would provide balanced exposure to both currencies. There have also been requests to convert the Grayscale Digital Large Cap Fund (GLDC) and the Bitwise 10 Crypto Index Fund (BITW) into an ETF. These are multi-token funds, which contain Bitcoin, Ether, Solana and much more.
Finally, there’s the “everything else” category, which includes literally everything you can think of. For example, the Nexo 7RCC Spot Bitcoin and Carbon Credit Futures ETF is an ESG Bitcoin ETF that will hold approximately 80% bitcoin and 20% carbon credit futures. The Bitwise Bitcoin Standard Corporations ETF intends to invest in companies that hold at least 1,000 bitcoins in their corporate treasury. The Strive Bitcoin Bond ETF aims to provide exposure to convertible securities issued by MicroStrategy. Additionally, I think we can see even more options-based strategies. And as we saw towards the end of 2024, crypto stocks returned to favor due to renewed interest in MicroStrategy and crypto miners, which pivoted to benefit from data center demand .
– Roxanna Islam, Head of Sector and Industry Research, TMX VettaFi
Ask an expert
Q. What is the status of the global ETF industry?
America is still the home of the ETF. Technically Canada is his country of birth, but with the US accounting for almost 70% of the global ETF market, I think it’s safe to call the investor an expat at this point.
That said, ETFs are quickly gaining ground in many foreign markets. In the first 11 months of this year, more than 550 ETFs were launched in the Asia-Pacific region (excluding Japan) and almost 300 products were launched in Europe, according to ETFGI. As active and crypto ETFs become more and more attractive, this global adoption trend will only increase.
Q. What is the future of ETFs/ETPs?
2024 has undoubtedly been “the year of the ETF,” with the United States alone seeing over $1 trillion in capital inflows. Globally, ETFs now hold over $15 trillion in assets and account for 30% of all invested assets. Over the next decade, they will likely overtake mutual funds as the dominant investment vehicle. And until tokenization shakes things up, every year will now likely be the year of the ETF.
Q. How has the US approval of Bitcoin and Ether ETFs changed the game?
Crypto ETFs are still booming around the world. Only a handful of markets offer them, including Australia, Canada, Switzerland, Brazil, and a few others.
The United States quickly became the leader in spot ETFs after the Securities and Exchange Commission approved the first ones earlier this year. The iShares Bitcoin Trust ETF has over $53 billion in net assets. Meanwhile, the Grayscale Bitcoin Trust ETF has surpassed $20 billion, and the Fidelity Wise Origin Bitcoin Fund is on the verge of doing so. The new Trump administration, which is expected to be very pro-crypto, will likely make it easier to issue and access crypto ETFs. You might start to see ETFs emerge that track smaller cryptocurrencies like Dogecoin.
The hype around US Bitcoin ETFs is so immense that it may have caused some investors to withdraw assets from similar products in other markets. For example, according to TD Securities data published by Bloomberg, Canadian Bitcoin ETFs have seen net outflows of more than $400 million this year. Meanwhile, US Bitcoin ETFs saw $36 billion in inflows.
–Griffin Kelly, reporter, The Daily Upside
