Bitwise Asset Management has made a significant move in the cryptocurrency market by acquiring the Osprey bitcoin Trust (OBTC). This acquisition, as detailed in a recent press release, involves integrating Osprey's $120 million in assets into Bitwise bitcoin ETF (BITB), signaling a consolidation within the bitcoin exchange-traded fund (ETF) space.
As part of this transaction, OBTC unitholders will receive BITB shares in a liquidating distribution. It's worth noting that existing BITB holders will not experience any changes to their shares or the fund's operations, according to Bitwise.
Nothing Changes For Existing BITB Holders
Osprey has been running its bitcoin Trust since February 2021, following a structure similar to the Grayscale bitcoin Trust. However, unlike direct bitcoin investments, OBTC shares could trade at premiums or discounts to the underlying bitcoin holdings, leading to price discrepancies from the actual bitcoin market.
Recent data indicates that OBTC shares have declined by 4.27% over the past month, while bitcoin's price has dropped by 9.34%. In contrast, BITB has experienced a smaller decrease of 8.56%, showcasing closer alignment with bitcoin's price movements.
The transition to BITB offers OBTC unitholders benefits such as tighter tracking and a reduced management fee of 0.2%, compared to OBTC's 0.49%. Osprey sees this acquisition as a pivotal step in its previously announced consideration of a potential sale or merger of the trust.
Launched in January, BITB competes with industry heavyweights like BlackRock and Fidelity. Despite the competition, BITB has garnered substantial inflows, currently managing $2.4 billion in assets, making it the fifth-largest bitcoin spot ETF in the United States.
This recent acquisition adds to Bitwise's expansion, following its purchase of ETC Group and increasing its total assets under management to $4.5 billion, bolstering its presence in the European market.
bitcoin-etfs-see-outflows">Spot bitcoin ETFs See Outflows
On Tuesday, U.S. spot bitcoin ETFs experienced net outflows, breaking an eight-day streak of positive inflows, according to data from SoSoValue. During the period of positive inflows, the funds had accumulated $756 million.
The U.S. spot bitcoin ETFs reported $127 million in net outflows, with Valkyrie's BRRR fund data not yet updated. ARKB led the outflows with $101.97 million in negative flows, while Grayscale's GBTC fund saw net outflows of $18.32 million, and Bitwise's BITB recorded $6.76 million in outflows.
Eight funds, including BlackRock's IBIT, saw no activity on Tuesday. Excluding BRRR, the total trade volume for U.S. spot bitcoin funds reached $1.2 billion, with these funds accumulating $17.95 billion in net inflows since January.
In contrast, spot ether ETFs continued their ninth consecutive day of net outflows, reporting $3.45 million in negative flows on Tuesday. Grayscale's ether fund posted a daily net outflow of $9.18 million, offset by net inflows into Fidelity's FETH and Bitwise's ETHW.
The cryptocurrency market continues to experience fluctuations and developments, with acquisitions and fund movements shaping the landscape of digital assets. As investors navigate these changes, staying informed about the latest trends and updates is crucial for making informed decisions in this dynamic sector.
