BlackRock Bitcoin and Ethereum ETFs Register 83% Dip in Q1 Inflows

BlackRock spot Bitcoin and Ethereum Exchange Traded Funds (ETFs) may have lost their initial touch. The market has been quite unfavorably, causing these funds to record massive declines in inflows. In Q1 2025, iShares Bitcoin Trust (IBIT) and iShares Ethereum Trust (ETHA) ETF inflows declined by approximately 83%. This is a notable dip for two crypto ETFs leading their counterparts.

Trump Hype Spurred Crypto ETF Inflows 

The company’s first-quarter earnings report shows that in the first three months, inflows into the BlackRock crypto ETFs totaled $3 billion, representing an 83% plummet from the value recorded in Q4 2024. 

However, the massive inflows recorded towards the end of the year could be attributed to the excitement and anticipation surrounding Donald Trump’s victory and entry into office.

Ordinarily, the expectation would be that Trump’s entry into the White House in Q1 2025 would spur the market further. 

Unfortunately, this is not the case, particularly with spot crypto ETF inflows. On the brighter side, the numbers from Q1 still reflect the strong demand for crypto-linked funds when considered singly.

Bitcoin and Ethereum ETF Inflows to Improve in Q2 2025

Juan Leon, Senior Investment Strategist at Bitwise, strongly believes that Q2 2025 will be better than the previous quarter. 

In clear terms, he stated that Bitcoin ETFs could see over $3 billion in inflows in Q2 2025. BlackRock CEO Larry Fink supports this stance, believing that sentiment may change soon as the United States government and regulators take a more favorable stance on Bitcoin.

The crypto ETF landscape has improved since the beginning of this new quarter. According to Farside Investors, BlackRock’s ETHA is one of the trailblazers, recording as much as $6.4 million in daily inflows. 

Bridging TradFi and Crypto Assets 

Generally, the growing demand for Bitcoin and Ethereum ETFs signals a broader trend of Traditional Finance (TradFi) integration with cryptocurrencies or the blockchain sector. 

Apart from the evidence of this sentiment in the ETF market, other sectors, like Real-world Assets (RWAs) and tokenization, are experiencing this shift. 

Recently, Standard Chartered and Brevan Howard hinted at a plan to enter the world of tokenization in conjunction with cryptocurrency exchange OKX. 

According to a statement from Star Xu, OKX CEO, the move conveniently bridges the gap between TradFi and crypto assets. Even BlackRock falls into the category of traditional finance firms taking up shares in the crypto tokenization world, with BUIDL recently paying out $4.17 million in dividends.