Institutional players bought 859,454 Bitcoins (BTC) in 2024, equivalent to eight years of BTC issuance and 4.3% of its total circulating supply, according to a K33 Research report.
The majority of the amount was purchased by spot exchange-traded funds (ETFs) and public-listed companies like MicroStrategy.
The rise of US-traded spot Bitcoin ETFs emerged as a defining factor in 2024, reflecting a growing demand for regulated exposure to BTC. Bitcoin investment vehicles collectively added 561,781 BTC, with US ETFs dominating inflows. These funds now manage 1.4 million BTC.
BlackRock’s spot Bitcoin ETF IBIT holds the most assets under management (AUM), both in dollars and Bitcoin, with a 542,653 BTC stash worth nearly $54 billion as of press time.
The launch of spot Bitcoin ETFs broke records, with net inflows reaching $36.7 billion in their first 239 trading days. This growth outpaced even gold ETFs, which took over 1,500 trading days to achieve similar figures.
By year-end, all Bitcoin ETFs traded in the US flipped gold ETFs in AUM, a milestone fueled by a strong Bitcoin rally and resilient investor behavior.
Turning markets liquid
Public companies significantly bolstered Bitcoin demand in 2024, adding 297,673 BTC to their treasuries. MicroStrategy alone acquired nearly 250,000 BTC through aggressive financing strategies, cementing its position as a key market player. The company now owns 439,000 BTC.
The institutional appetite for Bitcoin quenched the selling pressure registered in 2024. Approximately 230,000 BTC entered the market from bankruptcy estates, seized assets, and creditor distributions, including coins from Mt. Gox and the German government.
Nevertheless, these market dynamics helped make some BTC supply liquid, with 22% of the circulating supply available in markets nearing the 2021 highs. In addition, considering public company holdings, BTC is at an all-time high in liquidity.
Furthermore, these corporate holdings, alongside ETF inflows, are expected to remain “sticky,” limiting future sell-side pressure.
Bright horizon
In addition to the institutional interest, there is a growing appetite for a “Bitcoin Strategic Reserve” among lawmakers in recent weeks. President-elect Donald Trump renewed hopes that the US will hold BTC as a hedge against inflation, sparking optimism among investors.
While the proposed reserve faces legislative and logistical hurdles, its potential implementation could herald a new era of institutional and sovereign Bitcoin adoption.
Other countries, such as Bhutan and El Salvador, already hold Bitcoin in their treasuries. Meanwhile, discussions about a BTC reserve were born in Brazil and Switzerland.
This sovereign move, coupled with improved regulatory clarity and more funds embracing Bitcoin as a portfolio diversifier, could further boost institutional allocations.