The inaugural day of trading for the newly approved spot Bitcoin exchange-traded funds (ETFs) witnessed remarkable activity, with a staggering total of 700,000 individual trades across 11 Bitcoin ETFs. Industry analyst Eric Balchunas reported on January 12 that the total trading volume exceeded $4.3 billion, indicating robust demand for these products.
Notably, Grayscale’s Bitcoin Trust, now a spot ETF, saw over $2 billion in trading volume on its first day. This volume almost matched the combined volume of all other Bitcoin ETPs, thanks to Grayscale’s significant assets under management (AUM) advantage.
ETF analyst James Seyffart provided a similar analysis, estimating the total trading volume for the 11 new funds at $4.6 billion. BlackRock and Fidelity trailed Grayscale, recording volumes of $1 billion and $700K, respectively. Seyffart suggested that a considerable portion of this volume likely involved investors transitioning from GBTC to new ETFs due to more favorable fee structures or shifting from futures-based funds like ProShares to spot funds.
Vijay Boyapati, an industry author, echoed this sentiment, noting substantial outflows as investors moved away from previously available, costlier Bitcoin exposure methods. He predicted that, in the long term, the net flows into these ETFs would be substantial and positive.
Despite the significant activity in the ETF market, the spot Bitcoin market showed no remarkable reaction. Bitcoin’s price briefly touched $49,000 on the ETF launch day but later settled around $46,000. The total market capitalization remained stable at $1.85 trillion.
Altcoins, having experienced substantial gains earlier in the week, appeared to pause, leading analysts to speculate about a potential post-ETF market correction as the initial excitement wanes. This landmark day in the cryptocurrency market underscores the growing mainstream acceptance of Bitcoin and its integration into traditional financial systems, even as the market continues to adjust to these new investment vehicles.