Here’s Why Bitcoin ETF Flows Will Continue for Years, According to Bitwise CIO

Matt Hougan, the CIO of the crypto index fund and asset management firm Bitwise, believes inflows into spot Bitcoin exchange-traded funds (ETFs) will continue for years as more investors and institutions adopt the products.

In a tweet detailing his experiences during a 20-day road trip, Hougan said he met financial advisors who have already allocated 3% of their client’s portfolios to Bitcoin ETFs and those who have not nursed the thoughts at all, showing a gap in the adoption pace of the products.

Bitcoin ETF Inflows Are Long-Term

Hougan also engaged with national account platforms approving Bitcoin ETF investments later this month and others looking to do so in mid-2025. He said his discoveries indicated that the inflows the ETF market has experienced in the past two months are not a one-time thing but part of long-term sustained demand.

“After my time on the road, I’m convinced that the latter is the case. That’s because there is a massive dispersion in the pace of adoption of bitcoin ETFs,” Hougan stated.

The Bitwise CIO insisted that the situation of most professional investors, who are currently unable to buy Bitcoin ETFs, would change in the next couple of years as they conduct a series of individual due diligence processes.

In addition, Hougan said the ramp-up of inflows into Bitcoin ETFs would be shorter than gold ETFs, which saw inflows built over their first seven years in the market. Market analysts think the former could surpass the latter within months if high inflows persist.

3%, The New 1%?

Interestingly, Hougan claimed that 3% is the new 1% in Bitcoin investment allocation. He explained that in his six years of speaking with professional investors about Bitcoin, the talks revolved around a 1% allocation. However, that has changed, as almost every wealth market investor he met on his road trip mentioned a 3% allocation as the ideal standard.

“The primary reason imho is that the launch of ETFs has de-risked the downside of bitcoin. Before, people were worried bitcoin could go to zero. In that world, a 1% allocation is all you can stomach. But if “going to zero” is off the table, 3% or 5% starts to make more sense,” Hougan added.

Meanwhile, Hougan discovered that the demand for Bitcoin ETFs from U.K. investors is far behind the surge in the U.S.