"The digital gold" status in the market is gradually solidifying, with Bitcoin ETF becoming the new favorite in the portfolios of Wall Street giants in the first quarter

Zhitong Finance APP learned that with the launch of Bitcoin Exchange Traded Funds (ETFs), not only retail investors are beginning to enter this field, but institutional investors and large financial institutions are also showing strong interest. Over a decade ago, the introduction of ETFs brought new investment channels to the market, and now institutional investors including hedge funds, pension funds, and banks are also injecting funds into these funds.

Among these large buyers, hedge fund Millennium Management is particularly noteworthy, holding at least four Bitcoin ETFs with a total value of around $2 billion. In addition, Steven Cohen's Point72 Asset Management and Elliott Investment Management are also active participants in this field. Other investment entities include the Wisconsin Investment Board, Montreal Bank, as well as companies from Hong Kong, the Cayman Islands, Puerto Rico, Switzerland, and other locations.

According to Bloomberg's analysis of documents, about 1,000 investors disclosed their holdings of ETF stocks in the first quarter 13F reports submitted to the U.S. Securities and Exchange Commission. In addition, market makers trading ETFs, such as Citadel Securities and quantitative trading firm Susquehanna International Group, also reported their holdings in these funds.

Financial services giant Morgan Stanley is also a significant holder of Bitcoin ETFs. According to data from market insights company Fintel, Morgan Stanley purchased 4.27 million shares of Grayscale Bitcoin Trust (GBTC) worth $269.8 million on May 15th. This investment behavior indicates that Wall Street giants are incorporating the world's largest digital assets into their portfolios.

In addition to Morgan Stanley, other industry giants are also active in the cryptocurrency field. For example, BNP Paribas purchased 1,030 shares of iShares Bitcoin Trust (IBIT) worth $41,684 on May 2nd. A week later, Susquehanna purchased 17,271,326 shares of GBTC worth $1.09 billion in three batches, and also acquired millions of shares of other BTC ETFs created by BlackRock, VanEck, Fidelity, and ARK Invest.

Although these reports only reflect the situation at the end of the first quarter, it can be seen from these data that Wall Street is gradually entering the digital asset market.

Stephane Ouellette, CEO of FRNT Financial, pointed out that the growth of Bitcoin ETFs cannot be attributed solely to retail investors' purchases, as portfolio managers, institutional investors, and banks have started to venture into this field.

However, Matt Hougan, Chief Investment Officer of Bitwise Asset Management, stated that retail investors still hold the majority of the circulating supply of Bitcoin ETFs. He noted that professionals often make small individual allocations before making large allocations on behalf of clients to test market reactions.

BlackRock's iShares Bitcoin Trust (IBIT) is the market leader with holdings from about 420 companies that submitted 13F filings. Fidelity Wise Origin Bitcoin Fund (FBTC) has over 230 filers holding it, while Grayscale Bitcoin Trust (GBTC) has over 620 13F investors, with a total market value of around $8.4 billion.

Although the demand for Bitcoin ETFs is evident, investors may have different reasons for purchasing these ETFs. Some investors may use them as a diversification tool, while others may incorporate them into their trading strategies to leverage the volatility of cryptocurrencies or engage in arbitrage trading. Some investment strategies are model-driven and do not necessarily reflect a view on the fundamental value of Bitcoin.

While the participation of institutional investors indicates interest in Bitcoin ETFs, the market remains cautious about the long-term impact of these investments. Investment strategist Ben Brocker stated that Legacy Wealth views Bitcoin as a monetary asset and has moderately allocated 2% in its portfolio. He believes that in the digital age, Bitcoin is a better monetary asset than gold.

Chad Koehn, CEO of United Capital Management, emphasized the importance of using the right tools at the right time. He is optimistic about Bitcoin due to the Web3 innovative ledger technology behind it, as well as the importance of digital assets in hedging against inflation and currency devaluation.

Overall, the rise of Bitcoin ETFs signals increasing acceptance of cryptocurrencies in the traditional financial sector. With more institutional investors participating, this market will continue to grow and evolve