Bitcoin ETFs Outshine All 2023-launched ETFs, Exceeding Daily Volume Threefold

Data from Yahoo Finance, compiled by Cointelegraph, reveals that the combined daily volume of 10 recently approved spot Bitcoin ETFs on January 16 surpassed the total volume of all 500 ETFs launched in 2023 by more than three times.

On January 16, the 10 approved spot Bitcoin ETFs generated a total volume just over $1.8 billion. Notably, contributions from Grayscale, BlackRock, and Fidelity accounted for $1.6 billion of the total volume.

In comparison, the aggregate trading volume on January 16 for all 500 ETFs launched in the United States last year was a mere $450 million, as reported by Bloomberg ETF analyst Eric Balchunas.

BlackRock iShares Trust's Bitcoin fund emerged as the clear leader in net inflows, surpassing $497 million over the last three days.

The overall volume of all new spot Bitcoin ETF products reached nearly $10 billion in the first three days of trading, according to data from Bloomberg ETF analyst James Seyffart and Yahoo Finance.

While Grayscale's Bitcoin Trust (GBTC) still leads in overall trading volume, exceeding $5.1 billion, the fund has experienced significant outflows as investors seek to mitigate risks.

The outflows from the Grayscale Bitcoin Trust (GBTC) have surpassed $579 million since trading commenced on January 11. Balchunas added that BlackRock's product is poised to continue attracting the most significant inflows, making it the "most likely competitor to GBTC as the liquidity king."

Once considered a boon for investors who borrowed funds to enter the fund and profit from Grayscale's premium, which historically indicated demand for Bitcoin in the years preceding the advent of spot ETF products, this arbitrage strategy has now turned into substantial losses. The premium suddenly transformed into a discount, trapping many fund investors unwilling to sell their Bitcoin at a substantial markdown.

In summary, the introduction of spot Bitcoin ETFs has ignited substantial trading volumes, swiftly overshadowing the appeal of Grayscale's GBTC and positioning BlackRock's ETF as a formidable contender in the liquidity landscape.

Saturday, 20 April 2024