Since the launch of spot Bitcoin exchange-traded funds (ETFs) in the United States on January 11, these new investment vehicles have rapidly gained traction, with trading volumes soaring past $10 billion within just three days, as reported by Bloomberg Intelligence analyst James Seyffart.
This meteoric rise in trading activity has sparked debate, with some questioning whether the frenzied trading has had any substantial impact on Bitcoin’s price.
However, Eric Balchunas, another Bloomberg analyst, emphasizes the sheer magnitude of this achievement.
He points out that the $10 billion volume in the first three days dwarfs the performance of 500 ETFs launched throughout 2023, which collectively managed only $450 million in volume during the same period.
The most successful ETF from that batch achieved a mere $45 million in trading volume.
In contrast, BlackRock’s iShares Bitcoin Trust (IBIT) alone recorded more activity than the entire class of ETFs launched in 2023.
Regarding net inflows and outflows, the data shows a trend of investors moving away from the Grayscale Bitcoin Trust (GBTC), which recently transitioned into an ETF format.
Over three days, BlackRock’s IBIT accumulated an impressive $700 million in net gains.
Meanwhile, GBTC experienced net outflows of over $1.1 billion, likely due to investors switching to ETF products with lower fees.
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James Van Straten, a research and data analyst at CryptoSlate, expressed optimism about the ongoing trends:
“GBTC total outflows are now at $1.18 billion vs. spot Bitcoin ETF inflows of $2 billion. It would be extremely encouraging if we continued this pace for the first month of trading.”
CEO Samson Mow anticipates a return to ETF equilibrium in the near future, expecting Grayscale to adjust its fees and alleviate the selling pressure.
While these developments are exciting, the Bitcoin price remains within its well-established trading range since December 2023, hovering around $43,000.
Although some remain confident in the market’s strength at this level, concerns persist regarding Bitcoin’s ability to avoid another significant price decline.
Popular social media trader JT believes that there is still room for further decline, especially when considering the long-standing trading range.
The price has found support around $41,500 in January, repeatedly testing this level since the beginning of 2024, according to data from Cointelegraph Markets Pro and TradingView.
The cryptocurrency community remains watchful, hoping for stability and potential price growth as the ETF market continues to evolve.
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