The Bitcoin (BTC) market has undergone a remarkable recovery this year, largely due to the increased popularity of Bitcoin ETFs. BTC reached an all-time high of $73,000 in the first quarter of the year, sparking a bullish trend that continues today, with a recent high of $104,000.
The presidential election of Donald Trump has had a huge impact on this rise especially over the past month, as he has positioned himself as the first pro-crypto President, picturing America as the “crypto capital of the world.”
Trump’s favorable position toward digital assets has infused increased optimism among investors, resulting in increased buying pressure from Bitcoin ETF providers such as BlackRock and Fidelity. Notably, the top 12 Bitcoin ETFs have emerged as the biggest BTC holders, with a combined asset value of over $100 billion.
This figure represents one of the most successful ETF launches in financial history, with the 12 spot Bitcoin ETFs now collectively owning approximately 1.1 million BTC—equivalent to about 5% of all Bitcoin in circulation.
Bitcoin ETFs Expected To Surpass 2024 Inflows
In a recent report, crypto asset manager Bitwise outlined three key factors that suggest Bitcoin ETFs will continue to see explosive growth in 2025. Initially, it’s important to note that the first year of ETF operations is typically the slowest.
Historical comparisons with gold ETFs launched in 2004 show a significant increase in inflows over subsequent years. For instance, gold ETFs began with $2.6 billion in their first year, followed by $5.5 billion in the second year, and progressively higher amounts in the following years.
The firm suggests that if the 12 spot Bitcoin ETFs in the United States follow a similar trajectory, 2025 could see inflows that far exceed those of 2024.
Another factor contributing to potential growth is the anticipated participation of major financial wirehouses. Firms such as Morgan Stanley, Merrill Lynch, Bank of America, and Wells Fargo have yet to fully deploy their wealth management teams to promote Bitcoin ETFs.
As regulatory environments become more favorable under Trump, these institutions are expected to unlock access to Bitcoin ETFs for their clients, potentially directing trillions of dollars into the crypto market.
Investors ‘Laddering Up’
Finally, Bitwise has identified a clear trend among investors known as “laddering up.” This pattern indicates that initial small contributions to Bitcoin frequently lead to increasing investments over time.
The asset manager believes that many investors who entered the Bitcoin ETF market in 2024 will double down on their investments in 2025.
The firm’s assertion that “3% is the new 1%” indicates increasing acceptance of Bitcoin as a genuine asset class, which they believe will lead investors to dedicate a larger amount of their portfolios to cryptocurrencies.
At the time of writing, BTC had consolidated above $100,900 following a 7% dip to $91,000 at the start of the month. Over the previous 24 hours, the market’s biggest cryptocurrency has seen an almost 4% price increase.
Featured image from DALL-E, chart from TradingView.com