Bitcoin ETFs face gold-style boom-bust cycle, Bloomberg analyst says

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Bitcoin ETFs face boom-bust cycle

Highlights

BlackRock's iShares Bitcoin Trust (IBIT) assets dropped from about $100 billion in October to $60 billion as bitcoin fell to $63,000, down 30% this year.
Bloomberg's Eric Balchunas sees bitcoin ETFs following gold ETF cycles: rapid boom, subsequent bust, and potential for prolonged stagnation with higher eventual peaks.
BlackRock's digital-asset AUM fell about 40% year-on-year to $49 billion in Q2, mirroring sharp declines in bitcoin and ether prices, despite last week's first net inflows to U.S. spot crypto ETFs since early May.

Asset swings and historical comparison

As reported by The Block, citing Bloomberg, Senior ETF Analyst Eric Balchunas says bitcoin exchange-traded funds may be tracing a pattern similar to gold ETFs, with rapid gains followed by declines and long periods of stagnation. He argues that both products package non-yielding stores of value that generate no cash flow, leaving prices and fund demand heavily driven by sentiment rather than earnings, bond coupons or government backing.

Balchunas says the constrained supply of both bitcoin and gold can amplify demand and trigger sharp price rallies, but that demand tends to arrive in waves instead of building consistently. He points to BlackRock's iShares Bitcoin Trust, IBIT, which now manages about $60 billion in assets after briefly topping $100 billion in October when bitcoin reached a record high.

He compares that short-lived milestone with the SPDR Gold Trust's rise in 2011, when GLD briefly overtook SPY as the world's largest ETF. In his view, GLD's subsequent eight-year struggle to regain that level could offer a guide to what bitcoin ETF investors may face, although he also notes that each cycle in gold ETFs has ultimately set a higher peak.

Crypto fund pressure and market implications

IBIT's asset base has shrunk alongside bitcoin's price, which trades near $63,000 on Friday, down about 30% this year and roughly 50% below its October record. Gold is also lower in 2026, but the drop is milder, with spot prices near $4,000 an ounce, down about 7% year to date while remaining roughly 19% higher over the past 12 months.

The wider crypto downturn is also weighing on BlackRock's digital-asset business. The firm says this week that second-quarter digital-asset assets under management fall about 40% from a year earlier to roughly $49 billion, from nearly $80 billion, mainly because of sharp declines in bitcoin and ether prices; weaker prices and sentiment also pressure crypto ETF flows, although U.S. spot bitcoin and ether ETFs record weekly net inflows last week for the first time since early May.

In our earlier article on Marathon Digital (MARA) price analysis, we noted that the stock was trading under all key moving averages, reflecting persistent bearish pressure and weak momentum. The outlook pointed to a short-term consolidation range, but with elevated downside risk unless MARA could reclaim key resistance levels, as multiple indicators continued to signal seller dominance and oversold conditions.

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