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New Bitcoin ETFs Break Volume Record in the U.S.
The recently launched nine Bitcoin exchange-traded funds (ETFs) in the U.S. have broken an all-time daily record in volume, taking in $2.4 billion which is about double their recent daily average, according to Eric Balchunas from Bloomberg Intelligence.
Increased Trading Volume
The first day of trading for the ETFs was January 11, and the $2.4 billion in trading on Monday was mostly led by BlackRock’s ETF trading under the ticker “IBIT” which amassed $1.3 billion of the volume.
Reasons Behind the Surge
The sudden spike in volume at the end of the trading day could be attributed to the rising price of Bitcoin, which was trading at around $56,400 during press time. Eric Balchunas mentioned, “$IBIT went wild accounting for $1.3 billion of it, [$2.4 billion] breaking its record by about 30%. Not totally sure reason besides price rally generating interest but it does seem like these things really see heightened action on first day after weekend.”
BlackRock Leads Bitcoin ETFs
BlackRock’s IBIT ETF continues to lead the market and is ranked high as eleventh among all ETFs. Balchunas posted, “MILESTONE $IBIT has traded $1b worth of shares today so far.. which ranks it 11th among all ETFs (Top 0.3%) and Top 25 among stocks. Insane number for newbie ETF (especially one with ten competitors). $1b/day is big boy level volume, enough for (even big) institutional consideration.”
Competition and Fees
Competition among ETF providers heats up with fee slashes. VanEck slashed its fees for the HODL ETF down to 0.20% from 0.25% and BlackRock set its fee for the iShares ETF at 0.12% for the first 12 months or until the first $5 billion in assets under management. Other issuers, such as ARK Invest and Bitwise, charge 0.21% and 0.20% respectively. Spot Bitcoin ETFs are becoming the preferred choice for mainstream investors as they address issues like storing crypto assets and dealing with fraudulent service providers. Principal Research Analyst, Aurelie Barthere, expects lower-fee ETFs to attract more inflows in the short term.
Spot Ethereum ETFs on the Horizon
Several investment firms have filed applications with the SEC to launch spot Ethereum ETFs in the U.S. market due to the increasing demand. BlackRock, Fidelity, Grayscale, VanEck, Invesco, Franklin Templeton, Galaxy, Ark Invests, and 21Shares have all submitted applications for a spot Ethereum ETF.
Ian is a cryptocurrency enthusiast blending humor with professionalism. With an engineering background and a storyteller's heart, he simplifies the blockchain world with sharp analysis and a touch of wit. At Cryptowire, he brings his unique perspective to make digital financial innovation accessible to all.
