Bitcoin ETFs Pull In Billions While Gold Loses Steam
News Publisher Jun 09, 2025 01:34
Money is shifting fast in U.S. markets, and it seems that Bitcoin is getting the lion’s share.
Money is shifting fast in U.S. markets, and it seems that Bitcoin is getting the lion’s share. Over the past five weeks, spot Bitcoin ETFs have pulled in more than $9 billion, and leading the pack is BlackRock’s IBIT fund. Meanwhile, gold ETFs have seen nearly $3 billion in outflows, so the split points to a broader shift in how investors approach hedging risk.
Why Bitcoin Is Gaining Ground
Bitcoin has had a strong May, jumping around 10%, while gold dipped 2%. Although both assets hit record highs earlier this year, they’ve since taken different paths. Analysts say Bitcoin’s rising appeal comes from more than just price. It’s about perceived protection against U.S. debt concerns, political risks, and the weakening credibility of major institutions.
At the same time, people are finding more real-world uses for crypto. From portfolio hedging to privacy-friendly spending, Bitcoin is gaining ground. It’s even becoming the go-to currency in certain online spaces, where players use it to access top casino platforms that don’t require traditional KYC checks. (Source: https://99bitcoins.com/best-bitcoin-casino/)
Some analysts, like Jefferies’ Christopher Wood, still back both gold and Bitcoin as currency hedges. But others see Bitcoin pulling ahead, particularly in times of financial system stress. As Geoff Kendrick of Standard Chartered explained, Bitcoin's decentralized design makes it better suited to handle risks tied to the financial system, giving it an edge in times of institutional uncertainty.
The Basis Trade Effect
Not all inflows to Bitcoin ETFs are about belief in crypto. Traders are also taking advantage of the basis trade, which is a strategy where they buy spot Bitcoin and short futures, making a profit on the price gap. That’s been easier since the launch of spot ETFs.
Right now, the annual return on that trade is close to 10%, according to CME data. That kind of opportunity is attracting funds that are less interested in Bitcoin’s long-term potential and more focused on short-term gain.
Gold Still Has a Place
Bitcoin’s rising independence from tech stocks and its low correlation with gold and the dollar are strengthening the “digital gold” narrative. But it’s not a done deal, as many traditional investors still prefer gold for peace of mind. On top of that, 23% of US adults reported that they believe gold is the best investment.
Gold’s familiarity offers comfort, especially during geopolitical tension or market stress. Analyst Noelle Acheson noted that even though Bitcoin might bring more upside, many investors stay with gold simply because they know and trust it.
That split in mindset helps explain why gold continues to hold a strong position. Despite heavy flows into Bitcoin ETFs, gold remains ahead so far this year, rising 25%, compared to Bitcoin’s 12%.
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