in a new bitcoin-etfs-according-to-13f-filings” target=”_blank” rel=”noopener nofollow”>memorandum, Bitwise Chief Investment Officer Matt Hougan offered a detailed analysis of early adopters of bitcoin exchange-traded funds (ETFs) based on 13F filings with the SEC. His insights underscore significant adoption of bitcoin ETFs by professional investment firms, heralding a potential shift in the btc investment landscape.
Since their launch on January 11, bitcoin ETFs have captured an impressive $11.7 billion in assets, making them the most successful ETF launch in the annals of financial products. This explosive start has sparked widespread interest in investor identities, whether predominantly 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 any investors; They are some of the most respected and important asset managers in the industry. For example, Hightower Advisors, ranked the second RIA firm in the US by Barron's and managing $122 billion in assets, now owns $68 million in bitcoin ETFs. Similarly, Bracebridge Capital, a prominent Boston-based hedge fund that manages endowments for institutions such as Yale and Princeton, has invested a hefty $434 million.
Other major 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. In total, as of last Thursday's latest data, 563 professional investment firms have reported holding a combined $3.5 billion worth of bitcoin ETFs. Hougan anticipates that by the May 15 filing deadline, these numbers could increase to more than 700 companies with total assets under management approaching $5 billion.
“This is absolutely huge,” Hougan explained. “For any financial advisor, family office or institution wondering if they are the only ones considering exposure to bitcoin, the answer is clear: you are not alone.”
From a historical perspective, the scale of ownership by professional investors has been described as unprecedented. Bloomberg Senior ETF Analyst Eric Balchunas called the number of large-scale investors involved in bitcoin ETFs “crazy.” By comparison, when gold ETFs launched in late 2004 (a launch previously considered the most successful of all time) they attracted more than $1 billion in just five days. However, its first 13F filings showed that only 95 professional companies were investing. By contrast, bitcoin ETFs have dramatically surpassed this mark since their initial introductions.
Despite this increase in professional interest, Hougan's memo warns that the $50 billion total assets under management in bitcoin ETFs still have a substantial portion owned by retail investors. He estimates that professional investors currently account for only 7-10% of all assets. However, he suggested that the media's depiction of these ETFs as “retail-driven” funds could overlook a critical emerging trend.
“Most investors follow a familiar pattern,” Hougan said, describing a typical four-step investment path seen among institutions. Initially, there is a due diligence period that lasts between 6 and 12 months. After this, professionals can make a small personal assignment to test the waters before recommending larger assignments to their clients. Over time, this leads to more substantial platform-wide allocations across its entire client portfolio, typically ranging from 1% to 5% of the portfolio.
With these insights in mind, Hougan remains “incredibly” optimistic about the future of bitcoin ETFs. He concluded: “The allocations we see in recent 13F filings are just a down payment.” He noted that companies like Hightower Advisors, with a current allocation of 0.05%, could substantially increase their investments. “Multiply that by the growing number of professional investors participating in the space and you can start to see what's behind my enthusiasm.”
Surprisingly, yesterday, after Hougan published the memo, probably the most important 13F disclosure for bitcoin to date occurred. The Wisconsin State Investment Board reported purchasing $99,167,688 (2,450,400 shares) of IBIT from BlackRock and $63,687,310 (1,013,000 shares) of GBTC from Grayscale.
At the time of this publication, the price of btc stood at $61,940.
Featured image created with DALL·E, chart from TradingView.com