Bitcoin ETF Draws $371M Inflows Despite $66.8M Asset Decline

Woofun AI reports that Morgan Stanley Bitcoin Trust (MSBT) filed its first quarterly report, revealing a divergence between capital inflows and asset valuation during its first 85 days of operation.

Structurally, the fund recorded $371.1 million in gross share contributions while facing only $5.26 million in redemption distributions from April 7 through June 30. This resulted in a 1.42% redemption ratio and a net capital addition of $365.84 million, though net assets from operations decreased by $66.8 million.

Woofun AI data shows that 17.9 million shares were issued via 1,790 creation baskets, comprising $200.3 million in cash proceeds and $170.8 million in Bitcoin received, while 250,000 shares were redeemed through 25 baskets. By period end, 17.65 million shares remained outstanding, with GAAP figures and daily ETF flow tables reflecting different measurement bases.

Notably, the filing does not identify end sellers or their motivations, leaving it unclear whether retail activity drove the redemptions.

However, post-period growth was substantial: by July 31, shares outstanding rose to 21.74 million, an increase of 4.09 million, or 23.17%, from June 30. This surge confirms that net creation activity persisted beyond the reporting window, although the specific investors and distribution channels responsible remain undisclosed.

The data highlights a pattern where net creation activity continued even as Bitcoin fell, underscoring the disconnect between price action and institutional demand. These filing limitations prevent a precise attribution of the inflow sources, yet the volume suggests sustained interest despite market volatility.