Bitcoin spot exchange-traded funds (ETFs), known for short as BTC, have left an indelible mark on the market. Just three days after its launch in the United States, trading volumes have catapulted to more than $10 billion, as Bloomberg Intelligence analyst James Seyffart reported in a recent post on X (formerly known as Twitter). .
Bitcoin Spot ETFs Shatter ETF Standards
The recent launch of new Bitcoin ETFs on January 11 has generated a wave of debate. Despite the intense trading activity, it appears to have had minimal tangible effect on BTC price growth.
Despite this, Bloomberg analyst Eric Balchunas suggests the raw data paints a compelling picture.
In a response to Seyffart’s post, Balchunas provided some significant context.
“I want to put into context how astonishing a volume of $10b is in the initial three days,” he said. He highlighted that the 500 ETFs launched in 2023 only managed a combined volume of $450m. The most successful one reached $45m, and these had months to build momentum. Balchunas pointed out that the activity around $IBIT already surpasses the entirety of the ’23 Freshman Class.”
Examining the net inflows and outflows, it’s apparent that sales from the recently converted Grayscale Bitcoin Trust (GBTC) to an ETF continue.
According to data from BitMEX research, BlackRock’s iShares Bitcoin Trust (IBIT) has seen the most significant net gains, up by $700 million over three days. GBTC, however, has experienced net outflows of more than $1.1 billion. Analysts attribute this to investors shifting between ETF products due to the product’s higher fees.
GBTC’s total outflows are now at $1.18 billion vs. Bitcoin spot ETF inflows of $2B,” James Van Straten, a research and data analyst at CryptoSlate, stated.
Samson Mow, CEO of Jan3, predicted a return to ETF equilibrium following a period of flux post-launch, telling X subscribers on Jan. 13 that time is necessary for everything to recalibrate.
“The sell pressure on GBTC won’t be a lengthy process. Many can’t sell because the tax hit is too big, and eventually, Grayscale will have to capitulate on the fees. This will likely happen sooner rather than later.”
Bitcoin Price Range Remains Dominant
Amidst the ongoing developments, market analysts do not anticipate a surge in BTC price beyond its established trading range since the beginning of December 2023.
Related: Bitcoin daily RSI hits 4-month lows, with BTC price still up 70%
While some remain confident in the market’s strength at the current $43,000, there are lingering doubts about Bitcoin’s ability to avoid another capitulation. Social media trader JT argued that there’s still room to fall, regardless of a short-term pop.
“Once we reach the bottom of the long-standing range, we can reevaluate.”
Since January 2024, the $41,500 mark has formed the price action base, experiencing multiple tests as per data from Cointelegraph Markets Pro and TradingView.
This article does not offer investment advice or recommendations. Every investment and trading move involves risk, and readers should conduct their own research before making a decision.
