State Government Executes Bitcoin Purchase
Texas has purchased $5 million worth of BlackRock’s Bitcoin ETF (exchange-traded fund) and has earmarked an additional $5 million for a direct Bitcoin purchase. Lee Bratcher, president of the Texas Blockchain Council, announced in an X post that the state government completed the Bitcoin acquisition on November 20. During this period, Bitcoin was trading at approximately $87,000.
This strategic move follows Governor Greg Abbott’s approval earlier this year of a state-managed Bitcoin reserve. Bratcher elaborated on X, stating, "Texas will eventually self-custody bitcoin, but while that RFP process takes place, this initial allocation was made with @BlackRock’s IBIT ETF."
Bloomberg ETF analyst Eric Balchunas noted that Texas is now among entities like Harvard and Abu Dhabi in purchasing BlackRock’s IBIT. He expressed his belief that this combination is unique for a fund that has been available for less than two years, describing it as "More wild stuff for a not-yet-even-two-years-old fund."
State of Texas joining Harvard and Abu Dhabi in recent $IBIT purchase. Pretty sure that's the only ETF to ever be owned by all three. More wild stuff for a not-yet-even-two-years-old fund. https://t.co/uJHJKfKsO3
Bitcoin's price has been fluctuating near the $87,000 mark. As of 1:04 a.m. EST, it traded at $87,243.14, experiencing a 1% decrease in the preceding 24 hours, according to CoinMarketCap data.
The purchase by Texas occurred after IBIT had experienced a decline of over 24% in the last month. Balchunas observed in a November 24 post on X that short interest surrounding IBIT had significantly decreased, though he also pointed out that it "wasn’t exactly high to begin with at 2% of shares."
Texas Not the First to Purchase Shares in IBIT
Although Bratcher stated in his X post that Texas is the first state to buy IBIT shares, the state of Wisconsin had previously acquired IBIT shares in May of the previous year. Filings indicate that Wisconsin’s investment board purchased nearly $100 million worth of shares in the spot Bitcoin ETF at that time. Wisconsin subsequently more than doubled its investment in the fund before divesting its entire stake in the ETF earlier this year, according to the most recent filings.
US Spot Bitcoin ETFs Record Inflows in Latest Trading Session
The Texas Bitcoin purchase took place amidst a multi-day streak of outflows for the spot Bitcoin ETF market in the United States. Data from Farside Investors reveals that between November 12 and November 24, the funds only recorded two days of net daily inflows. During this same period, IBIT experienced only one day of net daily inflows.
On November 18, IBIT also experienced its most significant single-day outflows since its market debut in early 2024, with investors withdrawing $523 million from the investment product. However, in the latest trading session, IBIT managed to break its outflow streak, recording $83 million in net daily inflows. Fidelity’s FBTC saw the largest inflows of the trading session, amounting to $170.8 million. This was sufficient to offset the outflows observed from Bitwise’s BITB, Ark Invest’s ARKB, and VanEck’s HODL. Collectively, the funds experienced total net daily inflows of $128.7 million.