Fidelity snaps up 1% of all Bitcoin as institutional buying surges

• Fidelity holds close to 200K BTC or 1% of the total BTC supply, second only to BlackRock’s IBIT. 
• Demand from ETFs and Strategy was currently not enough to drive BTC higher, per CryptoQuant. 

U.S. spot Bitcoin [BTC] ETF (exchange-traded funds) are back with a bang, posting the second daily inflow of $601.94 million on the 3rd of July.

However, the Fidelity BTC ETF fund (FBTC) has recently seen more aggressive demand than BlackRock’s IBIT. 

In fact, at press time, FBTC led inflows with $237.13 million, compared to IBIT’s $224.53 million, SoSo data showed.

On the 2nd of July, FBTC also dominated the BTC ETFs, attracting $183 million of the overall $408 million inflows seen on that trading day. 

Since Q2, the sustained inflows into FBTC have increased its holdings to 199,493 BTC as of 4th of July.

This translates to $22 billion worth of net assets per current prices and 1.02% of the total BTC supply of 21 million coins.  

Q2 institutional BTC demand surge

Fidelity’s BTC ETF growth is part of a broader surge in institutional accumulation from Q2. Notably, ETFs scooped 111,411 BTC in Q2, increasing their overall BTC stash by 8%. 

But public corporate treasuries, led by Strategy (formerly MicroStrategy), bought more BTC (131K BTC) and grew their BTC stash by 18%. 

On the ETF side, Fidelity was second only to BlackRock’s IBIT in terms of total BTC holdings. IBIT had 692,887 BTC or 3.3% of the total BTC supply, as of the 4th of July. 

Fidelity vs. BlackRock

However, according to Fintel data compiled by AMBCrypto, IBIT saw higher institutional holder growth of 9% compared to FBTC’s 2.6% in early Q3.

It meant more major institutional players like hedge funds and endowments piled on BlackRock than Fidelity. 

However, overall share-holdings and capital allocation were down in early Q3, suggesting a trimmed position likely linked to recent quarter-end rebalancing or diversification. 

That said, the strong demand from ETFs and public treasuries has not managed to juice up the broader spot market demand.

According to CryptoQuant, the apparent demand has dropped to 857K BTC despite ETFs and Strategy buying 748K BTC.

Per the analytics firm, the broader contraction could cap BTC upside in the short term. 

“ETFs and MSTR purchases are a portion of Bitcoin demand; overall demand contraction is more than offsetting these purchases, and the acceleration of overall demand growth is what drives price rallies.”

As a result, CryptoQuant stated that although ETFs and Strategy’s buys were positive, they ‘are not sufficient to drive prices to fresh all-time highs.’

The asset was valued at $108.8K, at press time, after tagging $110.5k on the 3rd of July.