Exchange-traded funds (ETFs) appear set to finish 2025 as the most popular financial instrument among investors and financial advisors for the second year in a row.
In 2024, global ETFs set a record at $1.5 trillion. Of that, a record $1.1 trillion went into U.S. ETFs, surpassing 2021’s record of $901 billion.
While their role in many portfolios is to provide broad diversification across indices, themes, or commodities such as gold, ETFs are also increasingly used by investors seeking equity market exposure to the crypto sector. These funds offer a simplified approach that doesn’t require knowledge of gas fees, Web3 wallets, or blockchain mechanics.
By Oct. 15, Bitcoin and Ethereum ETF inflows reached $48.7 billion, surpassing 2024’s total despite ongoing volatility in digital asset prices.
For investors looking to add crypto exposure without having to open wallets or manage private keys, two industry-leading crypto ETFs provide access without direct ownership of BTC or ETH.
Short-Term Volatility Makes for a Crypto Buying Opportunity
October—or “Uptober” among crypto enthusiasts—is historically a strong month for the crypto market. However, this year, as with many asset classes, crypto prices have been harder to predict.
Since the second week of October, Bitcoin and Ethereum have retraced more than 14% and nearly 20%, respectively, from their one-month highs. Yet, after climbing more than 65% and nearly 208% from their year-to-date bottoms before the pullback, both assets were due for a correction.
In total, $500 billion was wiped out from the crypto market amid renewed U.S.–China trade tensions. Nonetheless, long-term trends remain intact, supported by a crypto-friendly administration in Washington and continued U.S. dollar weakness—a factor that traditionally has an inverse relationship with Bitcoin prices.
By Oct. 15, noting a near-term buying opportunity, investors rushed into Bitcoin and Ethereum ETFs, staging a $340 million one-day reversal. Kevin Lee, chief business officer at Gate, told CryptoNews.com this was attributable to “price-insensitive” ETF buyers rebalancing into weakness.
This bullish buying has led analysts to suggest that crypto is entering an accumulation phase and could trade in a range before the next leg higher. For investors seeking entry before that happens, the and the remain down around 15% and 19%, respectively, from their YTD highs reached earlier in August and October.
BlackRock’s 2 Big Crypto ETF Offerings
The spot ETFs—both offered by BlackRock and backed by the coins—are two of the fastest-growing funds globally.
In its Q3 earnings call on Oct. 14, BlackRock’s executive team noted that it was “exploring tokenizing long-term investment products like iShares” after witnessing explosive demand for exchange-traded products such as IBIT and ETHA since their debuts in January and July 2024.
CEO Larry Fink stated that IBIT is now the largest crypto ETF, with net assets exceeding $100 billion at the time of the earnings call. While smaller than the Vanguard S&P 500 ETF and its $765 billion in assets, IBIT’s growth trajectory demonstrates exponential expansion for a crypto fund less than two years old.
Wall Street’s Smart Money Appears to Agree
Fink referred to the ETFs’ surging popularity as “another proof point of [BlackRock’s] success” in adapting to evident demand for new market products. Institutional investors seem to agree.
Over the past 12 months, IBIT buyers have outnumbered sellers 1,287 to 312, generating $10.21 billion in inflows versus $126 billion in outflows. Similarly, 219 ETHA buyers have outnumbered 35 sellers, with inflows of $1.07 billion versus outflows of just $116.66 million.
Meanwhile, IBIT’s short interest of 1.04% is nearly 16% lower than the previous month, suggesting bearish sentiment is fading. Ethereum tends to follow Bitcoin much like silver follows gold; in that context, short interest for ETHA stands at 5.96%—higher than IBIT’s but still more than 61% lower than the month prior.