Crypto ETPs Register Massive Growth in 2023
The latest report by digital asset platform Fineqia shows that global cryptocurrency exchange-traded products (ETP) experienced a significant increase in 2023, surpassing the growth of underlying assets. Notably, ETPs issued by companies such as 21Shares, Grayscale, and CoinShares recorded a 91% surge in total assets under management (AUM) from January 1 to October 31, 2023. This surge outpaced the growth of underlying digital assets by 30%, as these assets experienced a slower growth of around 70% over the same period.
Fineqia’s study included 168 crypto ETPs. The data was compiled from sources like 21Shares, Grayscale, and VanEck Associates, among others, and is updated at the start of each month based on the previous month’s data. The report attributed the surge in crypto ETP AUM to Bitcoin’s larger proportion within digital asset ETPs compared to its overall market share.
Moreover, as Bitcoin accounts for 75% of the total crypto ETP AUM, the excitement surrounding a potentially forthcoming spot Bitcoin exchange-traded fund (ETF) in the United States was also noted. At the same time, it’s essential to look at the dynamics in the crypto ETP market and the overall crypto markets, as they are displaying positive signals that the approval of Bitcoin Spot ETFs may be near.
Bitcoin ETF Applications
At the time of the report’s release in mid-November, the US Securities and Exchange Commission (SEC) had yet to make a decision on 12 spot Bitcoin ETF applications from firms such as 21Shares and WisdomTree. Additionally, the SEC delayed the approvals for another three spot Bitcoin ETF applications by companies like Franklin Templeton, Hashdex, and Global X, signaling that the market could be awaiting a positive decision. Ultimately, Bitcoin ETP AUM reached $38 billion in October, marking the highest figure since May 2022 and underscoring the growing interest in cryptocurrency investment products.
Hot Take: Growing Interest in Bitcoin ETPs Fuels Market Speculation
The overwhelming surge of the cryptocurrency exchange-traded product (ETP) market in 2023 has outpaced the growth of underlying digital assets, signaling growing interest and excitement in these investment vehicles. The clear indication of robust growth has been substantiated through the report by Fineqia, showcasing a significant uptick in the total assets under management (AUM) for crypto ETPs. With Bitcoin’s dominant share in the overall crypto ETP market, the imminent and potential approval of Bitcoin Spot ETFs in the US market is further adding fuel to the market’s speculative sentiment. The market seems to be leaning towards a positive response from the US Securities and Exchange Commission (SEC) for spot Bitcoin ETF applications, potentially leading to a dynamic shift in the cryptocurrency investment landscape, underscoring a broadening appetite for innovative investment vehicles tailored for digital assets.
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