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European bitcoin ETPs suffer from increasing outflows
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European bitcoin exchange-traded products have suffered outflows every month this year, even as providers’ hopes have risen following the approval of spot bitcoin ETFs in the United States.
Bitcoin ETPs domiciled in Europe have bled $506 million since the start of this year, while other cryptocurrency ETPs have attracted small net inflows of $42 million, Morningstar data shows. In this period the price of bitcoin has increased by around 40%.
The findings come as crypto product providers look to capitalize on institutional demand for digital assets, with the UK regulator approving the first listings of bitcoin ETPs on the London Stock Exchange.
The European outflows contrast with the $13.4 billion inflows enjoyed by crypto products domiciled in the United States, where the financial regulator first approved the launch of spot bitcoin ETFs in January.
This article was previously published by It sets Europe on firetitle owned by the FT Group.
Pierre Debru, head of quantitative research and multi-asset solutions at WisdomTree, said the number of client inquiries for European cryptocurrency ETPs has “significantly increased” since the US launch, but this has not yet translated into large inflows.
Debru added that the low fees charged by US bitcoin ETFs have “created a new fee environment in Europe” by forcing European issuers to reduce their fees.
WisdomTree was one of many asset managers to cut fees on its bitcoin ETPs after launching in the US, along with Invesco and CoinShares.
Monika Calay, director of UK manager research at Morningstar, said understanding short-term bitcoin fund flows this year is “no simple task” and that market sentiment “remains fragmented”.
“Some see it as a hedge against inflation, others see it as a new currency and many consider it alongside other high-risk assets,” he said.
Calay added that the recent bitcoin halving, which saw bitcoin’s issuance rate halved to maintain its scarcity, was a “significant event” in the cryptocurrency’s history that could “significantly affect” bitcoin ETP flows.
“Historically, such halving events have led to supply shocks, sparking both increased interest and speculation within the crypto community, [but] May has already seen a demonstration,” he said.
“As the bitcoin narrative evolves, market participants must grapple with the complexities and uncertainties surrounding this unique asset class,” he added.
US-based ETF provider VanEck said at the time of launching Bitcoin spot ETFs in the US that it intended to be “more aggressive” in marketing its crypto products in Europe following the US launch.
Martijn Rozemuller, managing director of VanEck’s European operations, said his company has seen a small net inflow into its bitcoin and ethereum-traded notes this year.
These inflows occurred especially around the time of the US approval decision and in recent months, when bitcoin and other crypto assets have shown a “significant price recovery,” he said.
According to Morningstar data, the firm’s European digital asset ETNs saw net inflows of €8.5 million in 2024, with assets rising to €650 million.
“Considering the potential size of the total market, European cryptocurrency ETPs are still relatively larger than US spot bitcoin ETFs,” Rozemuller said.
At the end of April, Bitcoin ETPs in Europe managed $6.4 billion in assets, while in the United States, funds have total assets of $53.5 billion, Morningstar data shows.
*Ignites Europe is a news service published by FT Specialist for professionals working in the wealth management sector. Trials and subscriptions are available at igniteseurope.com.