The US spot Bitcoin ETF market experienced a notable shift in investor sentiment last week, with positive inflows breaking a month-long streak of outflows. This development indicates growing interest in newly approved index funds. A new player, Bracebridge Capital, entered the market and made substantial investments, quickly becoming one of the largest holders of Bitcoin ETFs.

Bracebridge Capital, a Boston-based hedge fund, reported owning $262 million worth of Ark Invest’s ARKB ETF. They also emerged as the largest owner of Blackrock’s IBIT with an investment of $81 million. Additionally, Bracebridge Capital holds $20 million of Grayscale’s Bitcoin Trust (GBTC), which experienced negative outflows of $103 million during the same period. Bloomberg ETF expert Eric Balchunas described Bracebridge Capital’s investment as a “wild” move, noting the firm’s significant acquisitions .

In contrast, the Bitcoin ETF market in Hong Kong has been experiencing slower but consistent outflows. On Friday, May 10, 2024, there was an outflow of $6.3 million, followed by an $18.5 million outflow on Monday, May 13, 2024. These outflows come amidst rumors that Bitcoin ETFs listed in Hong Kong could soon become accessible to investors from mainland China .

The US Bitcoin ETF market has seen a positive shift in investor sentiment, with new players like Bracebridge Capital making substantial investments. On the other hand, the Hong Kong market is experiencing consistent outflows, but the potential for mainland Chinese investors to access these funds could significantly impact the market. As the situation continues to develop, market participants will be closely monitoring the potential impact on capital flows and the overall adoption of digital asset funds in the region.