Bitcoin ETFs surge as Trump’s crypto endorsement fuels record inflows

A group of 12 U.S.-based exchange-traded funds (ETFs) focused on Bitcoin is on the verge of achieving record-breaking monthly inflows, fueled by the cryptocurrency’s historic climb toward $100,000.

This rally comes in the wake of U.S. President-elect Donald Trump’s public embrace of the crypto sector, marking a pivotal shift in market sentiment.

According to data compiled by Nukta, Bitcoin-centric ETFs, including those managed by industry giants BlackRock and Fidelity Investments, have so far attracted $6.2 billion in November alone. This surpasses the previous peak of $6 billion recorded in February, driven by investor optimism following the launch of new financial products earlier in the year.

Last week, Bitcoin came close to the monumental $100,000 threshold for the first time, bolstered by Trump’s pledge to roll back the Biden administration’s regulatory clampdown on cryptocurrencies. His plans include appointing crypto-friendly regulators and establishing a strategic reserve of Bitcoin, signaling a new era for the digital asset industry.

Josh Gilbert, a market analyst at eToro, told Bloomberg, “We’re likely to see continued inflows into crypto ETFs under the Trump administration. The regulatory environment will be more accommodating, making it easier for corporations and pension funds to include these assets in their portfolios.”

Bitcoin’s rally, however, paused this week, with the cryptocurrency stabilizing at approximately $95,400 as of 8:53 a.m. in Singapore on Friday. Meanwhile, smaller cryptocurrencies like Cardano and XRP traded within narrow ranges. Bitcoin has more than doubled in value this year, outperforming traditional assets such as global equities and gold.

The U.S. Securities and Exchange Commission (SEC), under the leadership of outgoing chair Gary Gensler, reluctantly approved the launch of spot Bitcoin ETFs in January, following a landmark court ruling in 2023. The SEC subsequently authorized ETFs investing in Ethereum, the second-largest cryptocurrency by market cap.

Gensler, known for his critical stance on the volatile crypto market and its associated scandals, is preparing to step down from his position. Trump is expected to appoint a pro-crypto SEC chair, potentially paving the way for ETFs linked to a broader range of digital assets.

Interestingly, Trump’s newfound support for the cryptocurrency sector marks a dramatic shift from his earlier skepticism. Industry insiders note that his change in stance coincided with the crypto sector’s substantial lobbying efforts during his campaign, signaling a calculated move that could reshape the regulatory and investment landscape.