The Depository Trust and Clearing Corporation (DTCC) has made a statement declaring that exchange-traded funds (ETFs) linked to Bitcoin (BTC) or other cryptocurrencies have no value as collateral investments. The DTCC, which offers clearing and settlement services to the US financial markets, announced that digital asset-linked ETFs will be subject to a 100% “haircut.” This means that no collateral value will be given to any ETF or investment vehicle that includes Bitcoin or any other cryptocurrency as an underlying investment. The changes will go into effect on April 30, 2024, and will impact position values on the company’s collateral monitor. As a result, entities will no longer be able to use Bitcoin or crypto-linked ETFs as collateral when seeking credit or financing through the DTCC.

In March, CoinShares, a digital assets manager, reported that institutions had invested a record-breaking $2.9 billion into crypto investment products on a weekly basis, largely driven by Bitcoin ETFs. On-chain analyst Willy Woo recently shared with his 1 million followers on the social media platform X that the daily inflows of capital stored by the Bitcoin network, primarily due to ETFs, reached $2 billion per day. This is equivalent to the level seen during the last major bull market. Woo believes that this time, the inflows will reach even higher levels as spot ETFs open up the influx of capital. The inflows are measured on-chain, making it inclusive of all investors and about 90% accurate. It is also indicative that ETFs currently account for around 30% of total flows. Specifically, the daily change in entity-adjusted realized capitalization is taken into account. This measure reflects the USD stored in the network, considering the price paid for each BTC when it was moved to the current HODLers.

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