Bitcoin Becomes Second-Largest ETF Commodity in the US
With the launch of US Bitcoin spot ETFs, Bitcoin has quietly become the second-largest ETF commodity in the country, managing $26 billion. This surpasses silver ETFs, which hold slightly over $11 billion. In just five days of trading, net flows to the Bitcoin ETFs have increased by $1 billion.
Grayscale’s Dominance and Sell Pressure
However, most of the Bitcoin holdings in the ETFs are not from newly launched funds. The Grayscale Bitcoin Trust (GBTC) already had $23.1 billion worth of assets in Bitcoin before the conversion into an ETF. Since then, Grayscale’s holders have been selling their BTC at a rate of $500 million per day, causing significant sell pressure.
Analysts find it difficult to ignore Grayscale’s sell pressure and its impact on other competitors in terms of asset outflows.
Bitcoin Compared to Silver and Gold
After the launch of the ETFs, Bitcoin’s price dropped to a yearly low of $40,300, leading some investors to believe it was a “sell the news” event. In contrast, gold and silver prices remained relatively stable this month.
Bitcoin is often compared to gold and silver as a hedge against monetary debasement. However, SEC chairman Gary Gensler argues that Bitcoin should not be easily compared to gold due to its speculative nature and illicit uses.
Hot Take: Bitcoin Surpasses Silver in US ETF Market
The approval of Bitcoin ETFs by the SEC has propelled Bitcoin to become the second-largest commodity in the US ETF market. Despite its price drawdown after the ETF launch, Bitcoin’s position as a significant investment asset is undeniable. As the market continues to evolve, it will be interesting to see how Bitcoin’s dominance in the ETF space unfolds and whether it can maintain its position against other traditional commodities like gold and silver.
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