Bitcoin Hits $49,000 as Bitcoin ETFs Launch in the US
Bitcoin (BTC) surged to a new multi-year high of $49,000 shortly after the first US Bitcoin spot ETFs became available on public markets. This milestone was accompanied by substantial trading volume, with all 11 fund providers collectively trading $1.7 billion in volume.
Leading Volume Performers
Grayscale’s Bitcoin Trust (GBTC) emerged as the leader in terms of trading volume, with over $446 million traded within just 30 minutes of the market opening. Blackrock’s iShares Bitcoin Trust (IBIT) followed closely behind with $388 million in volume, making it the most successful newly launched fund. Fidelity’s fund (FBTC) and Ark Invest/21Shares’ fund (ARKB) also gained traction, accumulating $230 million and $82 million in volume respectively.
Cumulative Flows and Comparisons
The cumulative flows of these newly launched ETFs have surpassed those of BITO, the Bitcoin futures ETF approved in 2021. BITO reached $2 billion in assets under management shortly after its spot ETF counterparts were given the green light. It is worth noting that while a significant portion of the volume can be attributed to newly added funds, it is difficult to determine exactly how much.
Differentiating Factors
Grayscale’s Bitcoin Trust has experienced notable outflows compared to its competitors. One possible reason for this is its higher annual management fee of 1.5%, which is significantly higher than its competitors’ fees that range below 0.5%. This difference may incentivize some investors to rotate into newer and more cost-effective options.
Bitcoin Price Reaction
The launch of Bitcoin ETFs coincided with a surge in the price of Bitcoin, pushing it to $49,007. However, the price dipped back to $47,800 at the time of writing.
Hot Take: Bitcoin ETFs Fuel Bitcoin’s Surge
The launch of Bitcoin ETFs in the US has played a significant role in driving Bitcoin’s price to new heights. With substantial trading volume and strong interest from investors, these ETFs have quickly gained traction in the market. While Grayscale’s Bitcoin Trust leads in terms of volume, its higher fees have prompted some investors to explore alternative options. Overall, the introduction of ETFs has provided easier access to Bitcoin for both retail and institutional investors, further establishing its position as a mainstream investment asset.
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