44% Of Bitcoin ETFs On HODL, Says 10x Research

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The narrative surrounding institutional adoption of Bitcoin through exchange-traded funds (ETFs) in the United States may not be as strong as media headlines suggest. According to Markus Thielen, founder of 10x Research and former Head of Research & Strategy at Matrixport, only 44% of net inflows into spot Bitcoin ETFs are attributed to long-term holders—those truly "HODLing" BTC with a conviction in its future value.

This means that just under half of the capital flowing into these financial products reflects genuine belief in Bitcoin’s long-term potential. The remaining 56% appears to be driven by short-term, market-neutral strategies—particularly arbitrage plays where traders offset ETF inflows with short positions in Bitcoin futures.

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As of the latest data, the $17.5 billion worth of Bitcoin ETF holdings classified as long-term investments underscore a critical insight: much of the current demand is less about faith in digital assets and more about exploiting pricing inefficiencies between spot and futures markets.

The Reality Behind Institutional Demand

Thielen’s analysis challenges the widely circulated idea that institutions are flooding into Bitcoin at unprecedented levels. In his latest report, he argues:

“Rather than reflecting broad-based institutional adoption, the buying and selling of Bitcoin ETFs is primarily driven by funding rates (basis rate opportunities), with many investors focusing on short-term arbitrage rather than long-term capital appreciation.”

This distinction is crucial for understanding the true state of crypto market maturity. While ETF approvals were hailed as a watershed moment for mainstream acceptance, the underlying trading behavior reveals a more nuanced picture—one dominated by sophisticated hedge funds and quantitative trading desks rather than pension funds or family offices deploying strategic capital.

The implication? Institutional interest exists, but it's currently more tactical than transformative.

Still, there are signs of shifting sentiment. Thielen notes a notable uptick in long-only buying following former President Donald Trump’s victory in the 2024 U.S. election. Political clarity around crypto policy appears to have boosted confidence among longer-term investors, suggesting that regulatory visibility can significantly influence investment behavior.

U.S. Spot Bitcoin ETFs: A Market Snapshot

Data from Farside Investors shows that cumulative net inflows into spot Bitcoin ETFs since their January 2024 launch have reached $39.573 billion. However, this figure masks significant disparities among issuers.

BlackRock’s iShares Bitcoin Trust (IBIT) leads the pack with $40.879 billion in net inflows—a number exceeding the total market due to outflows experienced by other providers.

Grayscale’s GBTC remains a drag on overall performance, reporting $22.106 billion in net outflows since converting from a trust structure to a spot ETF. This exodus reflects investor migration from higher-fee legacy products to lower-cost alternatives like IBIT and Fidelity’s FBTC.

Other major players have seen solid adoption:

Despite Grayscale’s outflows, the fact that nearly all other issuers have achieved positive traction indicates growing structural demand—even if much of it is currently arbitrage-driven.

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Bitcoin Price Outlook: Key Levels to Watch

Market dynamics beyond ETF flows also play a critical role in shaping investor expectations. Ryan Lee, Chief Analyst at Bitget Research, forecasts that Bitcoin could trade between $92,000 and $105,000 in the near term.

The key determinant will be whether BTC can break and sustainably hold above the psychological $100,000 resistance level**, or if it retreats below the **$94,000 support zone. A confirmed breakout could trigger renewed institutional interest, especially from traditional finance players waiting for technical confirmation of strength.

Meanwhile, Ethereum (ETH) is expected to trade between $2,600 and $2,900, with a potential run toward $3,000 if bullish momentum accelerates. The upcoming Pectra upgrade—set to enhance scalability, security, and user experience—could serve as a catalyst for positive sentiment and increased capital allocation.

Frequently Asked Questions

Q: What percentage of Bitcoin ETFs are held by long-term investors?
A: According to 10x Research, approximately 44% of net inflows into U.S. spot Bitcoin ETFs are linked to long-term holders.

Q: Why do only 44% of ETF inflows represent true institutional adoption?
A: Because 56% of activity appears tied to arbitrage strategies—where investors hedge ETF purchases with short futures positions—rather than pure conviction-based investment.

Q: Which Bitcoin ETF has the highest net inflows?
A: BlackRock’s iShares Bitcoin Trust (IBIT) leads with over $40.8 billion in net inflows.

Q: Why is Grayscale’s GBTC showing negative inflows?
A: After transitioning to a spot ETF, investors moved capital to lower-fee competitors, resulting in sustained outflows from GBTC.

Q: How did the 2024 U.S. election impact Bitcoin investing?
A: Long-only buying increased notably after Donald Trump’s victory, likely due to his pro-crypto campaign stance and promises of clearer regulations.

Q: What factors could push Ethereum to $3,000?
A: Successful implementation of the Pectra upgrade and strong market sentiment could drive ETH toward $3,000.

Core Keywords

Bitcoin ETF, institutional adoption, HODL, spot Bitcoin ETF, arbitrage strategy, ETF inflows, long-term investment, crypto market outlook

The evolving landscape of digital asset investing demands clarity beyond headlines. While media narratives often emphasize sweeping institutional adoption, deeper analysis reveals a market still maturing—one where speculative strategies coexist with growing long-term conviction.

As regulatory clarity improves and product offerings diversify, the balance may gradually shift toward more sustainable ownership models. For now, understanding who's really buying—and why—is essential for any serious investor navigating the new era of asset-backed crypto finance.

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