BlackRock’s
application to establish a Bitcoin (BTC) exchange-traded fund (ETF
Exchange-Traded Fund (ETF)
An exchange-traded fund (ETF) is a collection of a mixture assets, i.e. stocks, commodities, bonds, or cryptocurrencies that tracks an index or underlying portfolio of investments.Of note, an ETF functions an arbitrage mechanism that is designed to keep it trading close to its net asset value. Most tradable ETFs track a specific index. This most commonly mirrors a stock or bond index. The popularity of ETFs has grown in recent years and are seen as an attractive investment due to its low cost, e
An exchange-traded fund (ETF) is a collection of a mixture assets, i.e. stocks, commodities, bonds, or cryptocurrencies that tracks an index or underlying portfolio of investments.Of note, an ETF functions an arbitrage mechanism that is designed to keep it trading close to its net asset value. Most tradable ETFs track a specific index. This most commonly mirrors a stock or bond index. The popularity of ETFs has grown in recent years and are seen as an attractive investment due to its low cost, e
Read this Term) has ignited
a new fever in the digital asset market. There are strong indications that Wall
Street giants are trying to claim a piece of the cryptocurrency pie for
themselves following the United States’ crackdown on ‘unregulated’ exchanges
like Binance and Coinbase.
Evidence of
investors once again favoring ETFs includes the largest influx into ProShares’
BITO Bitcoin ETF in a year, which last week totaled $65.3 million. On Friday, the fund traded 500 million shares, something that has only happened
five times in the past.
BITO is the first Bitcoin-related ETF launched
in the US, which tracks its movements in the futures market. It’s also the most
popular among large institutional investors. The sudden surge in popularity of
cryptocurrency ETFs coincides with a drop in activity on decentralized
exchanges like Coinbase and Binance.
The calm in
the Bitcoin cash market and inflows into the ETF market suggest a shift in investors’
behavior. According to the analytical firm Kaiko, the depth of the cryptocurrency market is currently very ‘thin’. Since the start of
the year, the crypto market has dropped by 20% and is evidently lacking retail
investors. Daily trading volume for BTC is $24 billion, which is a quarter of its volume from 2021 when Bitcoin was testing historical highs.
The lack of
activity can be partly attributed to the long-term consolidation of Bitcoin
prices, which beat the $30,000 level last week. The price lingered below this
psychological threshold for over a year, dropping to lows, such as $15,000 in
November 2022.
Adding to
this is the tightening regulatory loop in the US and the Securities and
Exchange Commission’s (SEC) effort to classify an increasing number of
cryptocurrency assets as securities. This temporary ‘reluctance’ to invest in the
unregulated space seems understandable.
However,
institutional players are taking advantage of this, once again opting for ETFs.
The Bitcoin Futures ETF $BITO had its biggest weekly inflow in a year as assets top $1b again. It also traded half a billion in shares on Friday, which it’s only done about 5 times before via @SirYappityyapppic.twitter.com/Xrq0lUaaTO
— Eric Balchunas (@EricBalchunas) June 25, 2023
BlackRock Proposes an ETF,
Others Follow
BlackRock,
the world’s largest asset manager, submitted an application on June 16 to
create a spot Bitcoin ETF, sparking a wave of similar applications over the
past few days. According to the official filing, BlackRock will use the CME CF
Bitcoin Reference Rate to track Bitcoin prices. CF Benchmarks, a subsidiary of the cryptocurrency exchange Kraken, collects price data from renowned
cryptocurrency exchanges worldwide.
Last week,
Invesco and WisdomTree, two large ETF issuers, made similar moves. Although both
entities’ applications to create comparable instruments were rejected in the
past, the industry hopes that this time may be different. The SEC, which is
openly at war with decentralized exchanges, might look more favorably on
proposals from regulated entities.
This is the
first application for a spot Bitcoin ETF since 2021 for Invesco. WisdomTree
also filed a similar application at the time, which was ultimately rejected at
the end of 2022.
ProShares’ BITO Bitcoin
ETF Gains Momentum
ProShares’
BITO Bitcoin ETF continues to gain momentum. The BITO fund, a recent
beneficiary of the growing popularity of crypto ETFs on Wall Street, has gained
almost 60% since the beginning of the year. As noted by Eric Balchunas, the
Senior ETF Analyst for Bloomberg, BITO almost perfectly tracks the spot price
of Bitcoin, lagging only 1.05% on a yearly basis.
Interesting thing re $BITO, even tho it got trashed by some bc futures roll costs yada yada, it pretty much has tracked bitcoin perfectly. It’s lagged spot by 1.05% ann, but it’s fee is 0.95% = only 10bps of roll (extra) costs, which is rounding error. Many predicted >5% a yr. pic.twitter.com/5TnQpRA3Ii
— Eric Balchunas (@EricBalchunas) June 25, 2023
“Main
drivers of last week’s rally appear to have been several institutional news
developments such as the BlackRock attempt to launch a bitcoin ETF. There are
however some underlying developments in the bitcoin market that might be giving
support to positive price movements,” Simon Peters, the Market Analyst at eToro, commented.
BITO prices
have yet to catch up to the peak spot prices of Bitcoin
Bitcoin
While some may still be wondering what is Bitcoin, who created Bitcoin, or how does Bitcoin work, one thing is certain: Bitcoin has changed the world.No one can remain indifferent to this revolutionary, decentralized, digital asset nor to its blockchain technology.In fact, we’ve gone a long way ever since a Florida resident Laszlo Hanyecz made BTC’s first official commercial transaction with a real company by trading 10,000 Bitcoins for 2 pizzas at his local Papa John’s.One could now argue that
While some may still be wondering what is Bitcoin, who created Bitcoin, or how does Bitcoin work, one thing is certain: Bitcoin has changed the world.No one can remain indifferent to this revolutionary, decentralized, digital asset nor to its blockchain technology.In fact, we’ve gone a long way ever since a Florida resident Laszlo Hanyecz made BTC’s first official commercial transaction with a real company by trading 10,000 Bitcoins for 2 pizzas at his local Papa John’s.One could now argue that
Read this Term and are slightly below
this year’s highs.
BITO
However, if the influx of funds maintains its current high
level and more companies submit applications to establish crypto ETFs,
overcoming the high of $18.36 in 2023 on the BITO chart seems to be only a matter of
time.
UPDATE: @DigitalAssets and @Fidelity is about to make a seismic move in crypto via both $BTC and $ETH.
Sources expect Fidelity to either make a bid for @Grayscale or quickly launch their own spot #bitcoin ETF. One or both are coming, soon.
**Blackrock and Fidelity will own…
— Andrew (@AP_Abacus) June 18, 2023
Especially since the market is still anticipating a move from Fidelity and Grayscale.
BlackRock’s
application to establish a Bitcoin (BTC) exchange-traded fund (ETF
Exchange-Traded Fund (ETF)
An exchange-traded fund (ETF) is a collection of a mixture assets, i.e. stocks, commodities, bonds, or cryptocurrencies that tracks an index or underlying portfolio of investments.Of note, an ETF functions an arbitrage mechanism that is designed to keep it trading close to its net asset value. Most tradable ETFs track a specific index. This most commonly mirrors a stock or bond index. The popularity of ETFs has grown in recent years and are seen as an attractive investment due to its low cost, e
An exchange-traded fund (ETF) is a collection of a mixture assets, i.e. stocks, commodities, bonds, or cryptocurrencies that tracks an index or underlying portfolio of investments.Of note, an ETF functions an arbitrage mechanism that is designed to keep it trading close to its net asset value. Most tradable ETFs track a specific index. This most commonly mirrors a stock or bond index. The popularity of ETFs has grown in recent years and are seen as an attractive investment due to its low cost, e
Read this Term) has ignited
a new fever in the digital asset market. There are strong indications that Wall
Street giants are trying to claim a piece of the cryptocurrency pie for
themselves following the United States’ crackdown on ‘unregulated’ exchanges
like Binance and Coinbase.
Evidence of
investors once again favoring ETFs includes the largest influx into ProShares’
BITO Bitcoin ETF in a year, which last week totaled $65.3 million. On Friday, the fund traded 500 million shares, something that has only happened
five times in the past.
BITO is the first Bitcoin-related ETF launched
in the US, which tracks its movements in the futures market. It’s also the most
popular among large institutional investors. The sudden surge in popularity of
cryptocurrency ETFs coincides with a drop in activity on decentralized
exchanges like Coinbase and Binance.
The calm in
the Bitcoin cash market and inflows into the ETF market suggest a shift in investors’
behavior. According to the analytical firm Kaiko, the depth of the cryptocurrency market is currently very ‘thin’. Since the start of
the year, the crypto market has dropped by 20% and is evidently lacking retail
investors. Daily trading volume for BTC is $24 billion, which is a quarter of its volume from 2021 when Bitcoin was testing historical highs.
The lack of
activity can be partly attributed to the long-term consolidation of Bitcoin
prices, which beat the $30,000 level last week. The price lingered below this
psychological threshold for over a year, dropping to lows, such as $15,000 in
November 2022.
Adding to
this is the tightening regulatory loop in the US and the Securities and
Exchange Commission’s (SEC) effort to classify an increasing number of
cryptocurrency assets as securities. This temporary ‘reluctance’ to invest in the
unregulated space seems understandable.
However,
institutional players are taking advantage of this, once again opting for ETFs.
The Bitcoin Futures ETF $BITO had its biggest weekly inflow in a year as assets top $1b again. It also traded half a billion in shares on Friday, which it’s only done about 5 times before via @SirYappityyapppic.twitter.com/Xrq0lUaaTO
— Eric Balchunas (@EricBalchunas) June 25, 2023
BlackRock Proposes an ETF,
Others Follow
BlackRock,
the world’s largest asset manager, submitted an application on June 16 to
create a spot Bitcoin ETF, sparking a wave of similar applications over the
past few days. According to the official filing, BlackRock will use the CME CF
Bitcoin Reference Rate to track Bitcoin prices. CF Benchmarks, a subsidiary of the cryptocurrency exchange Kraken, collects price data from renowned
cryptocurrency exchanges worldwide.
Last week,
Invesco and WisdomTree, two large ETF issuers, made similar moves. Although both
entities’ applications to create comparable instruments were rejected in the
past, the industry hopes that this time may be different. The SEC, which is
openly at war with decentralized exchanges, might look more favorably on
proposals from regulated entities.
This is the
first application for a spot Bitcoin ETF since 2021 for Invesco. WisdomTree
also filed a similar application at the time, which was ultimately rejected at
the end of 2022.
ProShares’ BITO Bitcoin
ETF Gains Momentum
ProShares’
BITO Bitcoin ETF continues to gain momentum. The BITO fund, a recent
beneficiary of the growing popularity of crypto ETFs on Wall Street, has gained
almost 60% since the beginning of the year. As noted by Eric Balchunas, the
Senior ETF Analyst for Bloomberg, BITO almost perfectly tracks the spot price
of Bitcoin, lagging only 1.05% on a yearly basis.
Interesting thing re $BITO, even tho it got trashed by some bc futures roll costs yada yada, it pretty much has tracked bitcoin perfectly. It’s lagged spot by 1.05% ann, but it’s fee is 0.95% = only 10bps of roll (extra) costs, which is rounding error. Many predicted >5% a yr. pic.twitter.com/5TnQpRA3Ii
— Eric Balchunas (@EricBalchunas) June 25, 2023
“Main
drivers of last week’s rally appear to have been several institutional news
developments such as the BlackRock attempt to launch a bitcoin ETF. There are
however some underlying developments in the bitcoin market that might be giving
support to positive price movements,” Simon Peters, the Market Analyst at eToro, commented.
BITO prices
have yet to catch up to the peak spot prices of Bitcoin
Bitcoin
While some may still be wondering what is Bitcoin, who created Bitcoin, or how does Bitcoin work, one thing is certain: Bitcoin has changed the world.No one can remain indifferent to this revolutionary, decentralized, digital asset nor to its blockchain technology.In fact, we’ve gone a long way ever since a Florida resident Laszlo Hanyecz made BTC’s first official commercial transaction with a real company by trading 10,000 Bitcoins for 2 pizzas at his local Papa John’s.One could now argue that
While some may still be wondering what is Bitcoin, who created Bitcoin, or how does Bitcoin work, one thing is certain: Bitcoin has changed the world.No one can remain indifferent to this revolutionary, decentralized, digital asset nor to its blockchain technology.In fact, we’ve gone a long way ever since a Florida resident Laszlo Hanyecz made BTC’s first official commercial transaction with a real company by trading 10,000 Bitcoins for 2 pizzas at his local Papa John’s.One could now argue that
Read this Term and are slightly below
this year’s highs.
BITO
However, if the influx of funds maintains its current high
level and more companies submit applications to establish crypto ETFs,
overcoming the high of $18.36 in 2023 on the BITO chart seems to be only a matter of
time.
UPDATE: @DigitalAssets and @Fidelity is about to make a seismic move in crypto via both $BTC and $ETH.
Sources expect Fidelity to either make a bid for @Grayscale or quickly launch their own spot #bitcoin ETF. One or both are coming, soon.
**Blackrock and Fidelity will own…
— Andrew (@AP_Abacus) June 18, 2023
Especially since the market is still anticipating a move from Fidelity and Grayscale.