ETFs signal increasing tradfi convergence

ETFGI’s latest research highlights rapid growth in both active ETF adoption and the institutionalisation of crypto-backed Exchange-Traded Products (ETPs).

The research and consultancy firm pinpointed a new global record in assets invested in the ETFs industry, hitting $16.27 trillion at the end of May.

Active ETFs specifically are on the rise , according to this report, with $220.25B YTD net inflows marking a movement away from passive-only-investing.

“Active ETFs attracted net inflows of $43.49 Bn during the month, gathering net inflows for the year of $220.25 Bn, much higher than the $124.63 Bn in net inflows YTD in 2024,” said ETFGI.

Among the most popular ETFs are iShares U.S. Thematic Rotation Active ETF, and iShares AI Innovation and Tech Active ETF, showing a continued market investment into technology and innovation sectors.

Insights also revealed the growth in crypto-backed ETFs, such as the iShares Bitcoin Trust (IBIT US) with $5.91 billion new assets in May, alongside Bitwise Ethereum Staking ETP ($107.69M in May inflows) and Grayscale Bitcoin Mini Trust ETF ($129.88M May inflows).

This growth marks another sign of decentralised finance experiencing convergence into traditional financial structures.

With the backing from huge institutional players such as BlackRock (iShares), Bitwise, and Grayscale, the foundations are being laid for a new financial future, where tokenised and traditional assets exist within an interoperable capital markets infrastructure.

 

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