First U.S. spot bitcoin ETF to close as inflows dwindle, investors chase AI returns
Reported by CoinDesk · AI-assisted summary by ChikoCorp AI News Desk
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Summary
Hashdex is closing and liquidating its U.S. spot bitcoin exchange-traded fund (ETF) called DEFI after August 17, marking what appears to be the first shutdown of a U.S. spot bitcoin ETF. The decision follows dwindling investor interest and flows into spot bitcoin ETFs since their approval in January 2024. The fund held $14.7 million in net assets at closure, making it the smallest U.S. spot bitcoin ETF by assets.
Why it matters
This closure highlights a shift in investor preference, as inflows into spot bitcoin ETFs have decreased while interest in AI-related investments has surged. The collective spot bitcoin ETF market has experienced net outflows over the past three months, indicating competitive pressures from other sectors. Though DEFI’s exit is significant, it does not threaten the overall growth of the U.S. spot bitcoin ETF market, which holds substantial assets.
Key context
Hashdex introduced DEFI initially as a bitcoin futures ETF in September 2022 but converted it to a spot bitcoin ETF nearly three months after BlackRock’s leading spot product, IBIT, launched. Spot bitcoin ETFs were first approved in January 2024 in the U.S., with varied adoption levels. Previous closures have happened with bitcoin futures ETFs but not with spot bitcoin ETFs in the U.S. Internationally, spot crypto ETFs have closed, such as Cosmos Asset Management’s Australian bitcoin and ether ETFs in 2022.
Key numbers and entities
Hashdex’s DEFI ETF held $14.7 million in net assets, WisdomTree’s BTCW had $142.4 million, and BlackRock’s IBIT led with $47.08 billion. The broader U.S. spot bitcoin ETF market contains $77.6 billion in net assets with $51.5 billion in cumulative net inflows. BlackRock’s iShares Future AI & Tech ETF gained 39% through July while the crypto market fell roughly 36%. Other notable ETFs include Fidelity’s FBTC with $9.95 billion in inflows and Grayscale’s GBTC with $27.47 billion of outflows. Hashdex still manages over $200 million across other U.S.-available crypto ETF products.
What remains unclear
The source does not flag open questions but notes that CoinDesk has reached out to Hashdex for comment, implying further details or explanations from Hashdex might be pending.