- Capula Management invests $464M in Bitcoin ETFs, holding stakes in FBTC and IBIT as of Q2 2024
- Bitcoin ETFs see $50B in inflows since January, with major funds like Capula and Millennium Management heavily investing
- Bitcoin ETF trading volumes hit $1B on Aug 5, reflecting high liquidity and investor engagement despite market volatility
Capula Management, recognized as Europe’s fourth-largest hedge fund, disclosed a substantial investment in Bitcoin exchange-traded funds (ETFs) during the second quarter of 2024. According to filings with the US Securities and Exchange Commission, the firm purchased shares totalling approximately $464.
The US Securities and Exchange Commission (SEC) 13F filings indicate that Capula holds significant stakes in two major Bitcoin ETFs: the Fidelity Wise Origin Bitcoin Fund (FBTC) and BlackRock’s iShares Bitcoin Trust (IBIT). The investment in FBTC amounts to approximately $211 million with 4,022,346 shares, while the stake in IBIT is worth around $253 million through 7,419,208 shares.
Although Bitcoin prices briefly fell below $50,000 in the first days of August, they immediately recovered to above $54,000. This volatility does not appear to be an obstacle for large institutional investors, who continue to value the liquidity and regulatory monitoring of ETF structures.
Market Dynamics and ETF Popularity
Since their launch, Bitcoin ETFs have registered net inflows from investors that have now breached the $50 billion mark from January of this year. What makes them more appealing is their low costs, great investor protections, and easy accounting features, which make them suitable for mainstream investors.
Crucially, Morgan Stanley has now allowed its wide network of financial advisers to recommend Bitcoin ETFs to clients—clearly marking that a new era in finance, with digital assets, is here to stay.
Recent trading activities reflect these dynamics. On August 5, Bitcoin ETFs experienced some of the highest trading volumes recorded, with transactions worth over $1 billion executed shortly after the market opened. According to Eric Balchunas, an ETF analyst at Bloomberg, such high volumes can indicate market trepidation but also demonstrate the deep liquidity critical for traders and institutional investors.
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Continued Growth Amid Market Fluctuations
Despite a challenging market environment, significant drawdowns in July led to $175 million in net outflows from Bitcoin ETFs, but the sector remains buoyant.
Other notable institutions, including the State of Michigan Retirement System, have also reported investments in similar financial products, indicating a clear trend towards embracing digital assets among traditional financial institutions.
Recent inflows and sustained trading activities further evidence institutional engagement. Such trends are not limited to Bitcoin; Ether ETFs launched in June have also captured about $8 billion in assets, illustrating a diversifying landscape for cryptocurrency investments in the ETF market.
Additionally, Other hedge funds, such as Millennium Management, have disclosed large exposure to Bitcoin-related assets, with investments totalling around $2 billion. These developments reflect traditional financial institutions’ growing trust in the feasibility of cryptocurrencies as part of diversified investment portfolios.
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