Oct 29, 2023

$1.5B Bitcoin ETF Trades as GBTC Discount Reflects $69K BTC Price

As the anticipation for potential regulatory shifts in the United States grows, Bitcoin (BTC) institutional investment vehicles have seen a huge surge in trading volume. Analytics from Bloomberg and other sources indicate that Bitcoin exchange-traded funds (ETFs) and other related instruments are approaching a new peak in weekly inflows. Web 2.0 vs Web 3.0, Harmony…

Image showing the first Bitcoin ETF trades of $1.5B as GBTC ‘discount’ echoes the $69K BTC price.
First Bitcoin ETF trades $1.5B as GBTC ‘discount’ echoes $69K BTC price

As the anticipation for potential regulatory shifts in the United States grows, Bitcoin (BTC) institutional investment vehicles have seen a huge surge in trading volume.

Analytics from Bloomberg and other sources indicate that Bitcoin exchange-traded funds (ETFs) and other related instruments are approaching a new peak in weekly inflows.

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As the possibility of changes in US regulations looms, Bitcoin (BTC) institutional investment vehicles have seen a significant increase in trading activity.

Data from Bloomberg and other sources indicate that Bitcoin ETFs and other related financial products are on the brink of breaking weekly inflow records.

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The potential for regulatory changes in the US has caused a surge in trading volume for Bitcoin (BTC) institutional investment vehicles.

Resources such as Bloomberg have reported that Bitcoin ETFs and other similar instruments are close to setting new highs in weekly inflows.

BITO, GBTC trade $2.5 billion

Speculations that the U.S. government might permit Bitcoin spot price-based ETFs have influenced not only BTC price but also the entire cryptocurrency ecosystem.

Apart from exchanges and mining companies, even institutional investment options have experienced a surge in demand.

According to Bloomberg senior ETF analyst Eric Balchunas, two of the most popular options had an impressive trading week ending on Oct. 27.

The ProShares Bitcoin Strategy ETF (BITO), the first futures-based ETF to receive approval in the U.S. in 2021, saw $1.7 billion in trading volume. This was the second-highest since its launch.

The Grayscale Bitcoin Trust (GBTC) also reported $800 million in volume, reducing its discount to the Bitcoin spot price to a two-year low.

“This $2.5 billion (top 1% among ETFs) invested in two less desirable methods (compared to spot) for exposure to Bitcoin shows that there is an audience for a spot ETF,” Balchunas concluded in his post on X (formerly Twitter).

William Clemente, co-founder of crypto research firm Reflexivity, echoed the sentiment, noting that ETF trading is “back in full steam.”

Legacy finance could “know something we don’t yet”

As Cointelegraph reported, GBTC has seen a remarkable comeback in recent months, even prior to BTC/USD gaining 15% last week.

Legal victories on the long road to gaining permission to convert GBTC into a spot ETF provided kindling, and Grayscale’s product now trades with an implied share price, which is just 13.1% below the BTC spot price.

Per data from monitoring resource CoinGlass, this is the lowest since November 2021, when Bitcoin itself was at all-time highs.

“The GBTC discount keeps narrowing,” popular Bitcoin and altcoin trader Mister Crypto meanwhile responded.

Despite this, investment management firm ARK Invest has reduced its GBTC holdings in step with the share price gains.

While ARK itself plans a Bitcoin spot ETF launch, GBTC now accounts for 10.24% of its ARK Next Generation Internet ETF — its first change since November 2022.

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