There’s a big change happening in the world of Bitcoin. Over time, U.S.-based ETFs will become the largest holders of Bitcoin, even surpassing Satoshi Nakamoto, the cryptocurrency’s mysterious founder. This development certainly also captures how institutional interest in the cryptocurrency space is growing.

Bloomberg senior ETF analyst Eric Balchunas surprised the crypto community with a far-fetched prediction regarding Bitcoin ownership. Balchunas claims that if trends continue, the world’s most elusive man, Satoshi Nakamoto, will no longer own the largest stake in the cryptocurrency by the end of this year. This prediction assumes a dramatic change in Bitcoin’s ownership landscape, with institutional players gaining ground very quickly.

I didn’t realize that US ETFs are on track to overtake Satoshi in bitcoin in October. BlackRock alone is already #3 and on track to be #1 by the end of next year, and will likely stay there for a long time Ht @EdmondsonShaun photo.twitter.com/QGsO00zrxp

— Eric Balchunas (@EricBalchunas) August 12, 2024

In that light, Bitcoin’s anonymous creator isn’t at the top of the list, with only around 1.1 million BTC in his/her/their possession. Yet US-based Bitcoin ETFs, which currently manage around 909,700 BTC, are quickly catching up to that number, underscoring a new reality of an influx of traditional financial institutions into the ecosystem.

As these ETFs continue to gain popularity, Nakamoto’s dominance could be surpassed, marking a shift in Bitcoin ownership dynamics. This total doesn’t include Grayscale’s holdings, which would reduce the number of ETFs to around 645,899 BTC.

Institutional Dominance

The rapidly increasing concentration of Bitcoin by US ETFs can largely be attributed to institutional players. BlackRock, the world’s largest asset manager, has also emerged as a heavyweight in the Bitcoin space. With 347,767 BTC in its IBIT Bitcoin ETF, it is now the third-largest holding and, at this rate, is likely to surpass all others by the end of 2025.

Bitcoin market cap currently at $1.20 trillion. Chart: TradingView.com

Fidelity’s foray into crypto

Another financial giant, Fidelity, has also made substantial progress in the cryptocurrency space. It currently holds 176,626 BTC, and its FBTC fund helps underscore the growing institutional participation in the market. Grayscale, another popular digital currency asset manager, went a step further in institutionalizing the Bitcoin ecosystem by owning a substantial 263,801 BTC.

The real identity of Satoshi Nakamoto remains a mystery. Image: Pixabay

Bitcoin: Timeframe Estimate

According to analysts, Bitcoin ETF holdings could surpass Nakamoto as early as October 2024. The timeline takes into account the current accumulation rate and the expected growth of the cryptocurrency market. Of course, institutional interest in Bitcoin will only increase in the coming years as players like Fidelity and BlackRock, who are leaders in this space, have channeled substantial investments into the same area.

That Bitcoin ETFs have become the largest holders of the cryptocurrency is big news. It highlights how Bitcoin is becoming more widely accepted and how institutional investors are gaining more confidence in the cryptocurrency sector. The more confidence people and organizations have in Bitcoin, the fewer doubts we will have, and soon we may even see more institutional money flowing into the space.

What this means for the future of Bitcoin – or whether the dynamics of the crypto market will shift with institutional investors at the helm – remains uncertain. However, a new era in the Bitcoin world is dawning, and it will be intriguing to see how it all plays out.

Main image from JPM & Partners, chart from TradingView