Bitcoin-backed exchange-traded funds (ETFs) have overtaken traditional gold ETFs in popularity among professional firms, signaling a significant shift in the investment landscape. Recent data reveals growing confidence among institutional investors in digital assets.

According to Vetle Lunde, senior analyst at K33 Research, 937 professional firms in the US included Spot Bitcoin ETFs in their 13F filings, compared to only 95 firms investing in gold ETFs during the same period. This data underscores a notable transition towards cryptocurrency investments.

While retail investors still hold the majority of Bitcoin ETF shares, professional investors' exposure surpassed $11 billion by the quarter's end, representing 18.7% of total assets under management (AUM) for Bitcoin ETFs. Institutional interest in Bitcoin ETFs is fueled by the potential for significant returns and the evolving perception of Bitcoin as digital gold.

Leading ETFs like ARKB and HODL have garnered substantial institutional support, with contributions from firms like ARK Invest and VanEck. Major financial institutions such as JPMorgan, UBS, and Wells Fargo have also invested in Bitcoin ETFs. Additionally, the State of Wisconsin Investment Board reported holding over $99 million worth of BlackRock’s IBIT by the end of the first quarter.

The resurgence in ETF investments followed the release of US inflation numbers meeting expectations, fostering economic stability and prompting increased holdings in ETFs. Notably, nine ETFs collectively added 3,893 BTC to their portfolios, totaling nearly $256 million, while Grayscale’s GBTC experienced an outflow of 839 BTC. Conversely, Fidelity significantly increased its holdings by adding 1,989 BTC. BlackRock’s IBIT is closely trailing GBTC with a total of 274,755 BTC under management.

The United States leads in Bitcoin ETF investments, with American firms contributing over $9.27 billion. Major US banks like Morgan Stanley and Wells Fargo have made significant investments, reflecting a milestone in integrating digital assets into traditional financial systems. Millennium Management emerges as the largest institutional investor, followed by firms like Susquehanna International Group (SIG) and Boothbay Fund Management, highlighting the nation's dominance in the expanding Bitcoin ETF market.