Millennium Management Loses $22.7M on Bitcoin and Ethereum ETFs in Q4

A Tough Quarter for a Bold Crypto Move

In a notable move, Millennium Management—a major hedge fund managing roughly $75 billion—entered the crypto ETF market in the fourth quarter of 2024. However, the timing couldn’t have been worse. According to a 13F-HR filing submitted to the U.S. Securities and Exchange Commission on February 14, the firm invested in two key digital asset products: the Grayscale Bitcoin Mini Trust ETF and the Grayscale Ethereum Mini Trust ETF. As of now, both are deep in the red.

Breaking Down the Numbers

Let’s look at what happened to Millennium’s investments.

Bitcoin ETF Holdings:

• Units Purchased: 768,911
• Initial Value per Unit: $43.11
• Current Value per Unit: $37.38
• Total Loss: Around $4.39 million
• Percentage Decline: 13.25%

Ethereum ETF Holdings:

• Units Purchased: 1,702,038
• Initial Value per Unit: $25.74
• Current Value per Unit: $14.96
• Total Loss: About $18.34 million
• Percentage Decline: 41.86%

Combined Loss: Approximately $22.7 million across both positions.

Why This Loss Matters

Millennium’s dip into the crypto space reflects a broader trend of institutional investors showing interest in digital assets. But as the numbers show, even seasoned players can take hits in this volatile market. The Ethereum bet, in particular, turned sour fast—dropping nearly 42% in just a few months.

And this is not the only setback for Millennium. The firm reportedly took an even larger hit—around $900 million—from index rebalancing strategies impacted by market volatility this year. Despite these challenges, Millennium remained down less than 1% through February, showcasing the resilience of its diversified approach.

Who Is Behind Millennium?

Founded by Israel Englander in 1989 with just $35 million, Millennium Management has grown into one of the most powerful hedge funds globally. Englander still owns 100% of the firm and has a reputation for aggressively pursuing multiple investment strategies. These include:

• Relative value trading
• Equity arbitrage
• Fixed income strategies
• Quantitative trading

Englander began his career as a trader on the American Stock Exchange, and his hands-on approach has been a key element of the firm’s success.

What This Says About Crypto ETFs

The performance of Millennium’s ETFs underscores two big takeaways:

1. Volatility Is Still King: Crypto ETFs may offer regulated access, but they’re still subject to the same wild swings as underlying assets.
2. Institutional Entry Is Not Without Risk: Just because a major hedge fund is involved doesn’t mean losses are off the table. Even the most calculated crypto bets can go south.

The Ethereum ETF drop of nearly 42% serves as a stark reminder of how fast sentiment and value can shift in the digital asset world.

Will Millennium Double Down or Pull Back?

It’s too early to say whether this experience will deter Millennium from further crypto exposure or simply serve as a cautionary lesson. Given the firm’s broad investment approach and tolerance for strategic risk, a complete pullback seems unlikely—but tighter risk management around crypto may be on the horizon.

The broader institutional interest in crypto has not vanished. Even amid a slump, hedge funds, asset managers, and even governments are watching the digital asset space with intent. The question remains: will they adapt to its volatility, or try to tame it?

Final Thoughts

Millennium’s recent $22.7 million paper loss shows that crypto exposure—especially through ETFs—carries substantial risk, even for institutional giants. While it’s a small dent in the fund’s massive portfolio, it sends a message: the path to crypto gains isn’t guaranteed, and timing is everything.

For everyday investors, this story highlights the importance of understanding what you’re investing in. Crypto may be entering the mainstream, but the risks are just as real—no matter how big your bankroll is.

FAQs

What ETFs did Millennium Management invest in?
They invested in the Grayscale Bitcoin Mini Trust ETF and the Grayscale Ethereum Mini Trust ETF.

How much did the firm lose on these investments?
Roughly $22.7 million across both positions.

Why is the Ethereum ETF loss bigger than Bitcoin’s?
Ethereum’s price dropped more significantly over the same time period, resulting in a much larger percentage loss.

Is Millennium likely to stay in crypto?
It’s uncertain, but given their multi-strategy approach, they may adjust rather than fully exit.