First Bitcoin ETF Loses Record Amount in its Initial Year

By Aahil

Finance

The world's first exchange traded fund tracking bitcoin's price has lost more investor dollars than any other ETF debut one year after its record-breaking launch.

In October 2021, asset firm ProShares established its Bitcoin Strategy fund, which raised almost $1bn in its first week on the New York Stock Exchange.

According to Morningstar Direct data for the Financial Times, the fund lost a record amount in its first year.

In a test for investors during the "crypto winter," its 70% share price collapse makes it the sixth-worst debut ETF ever.

The ETF known as BITO has regularly garnered inflows over the course of its existence, with just modest withdrawals.

However, despite net inflows of $1.8 billion in its first year, its assets currently total $624 million.

According to ProShares, "BITO has closely tracked bitcoin from debut, which is what we feel our owners expect from the fund."

The highly anticipated debut of BITO assisted in raising the price of bitcoin from its launch day low of $63,000 to all-time highs of around $70,000.

However, it became evident in November of last year that US interest rates would begin to rise, severely hurting speculative assets.

Given its performance, the fund has not experienced the outflows one might anticipate, according to Rosenbluth.

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