• Sat. Apr 13th, 2024

Rough Day for Spot BTC ETFs Amid $4.6 Billion Traded

Maria Bartiromo

ByMaria Bartiromo

Jan 12, 2024

Amid a $4.6 billion total transaction volume, the highly anticipated launch of Spot Bitcoin Exchange-Traded Funds (ETFs) was met with a difficult start, making it a volatile day for the ETFs and Bitcoin itself.

Varinder Singh from CoinGape has described the introduction of Spot Bitcoin ETFs as a signal to the beginning of a new age of regulated investment products linked to the most valuable digital commodity in the world. The report shows that the spot BTC ETF recorded zero inflows at the same time the 4.6 billion overall trading volume for the recently listed ETFs was considered. 

Due to 1.5% fee increases and the locking up of older Bitcoin, sales, and withdrawals accounted for most of the observed activity. The “real numbers were close to approximately ZERO new inflows,” as Neuner said, highlighting a sharp contrast to the excitement around the ETF debut.

Worries, As Price of BTC Swing Between $49,000 and $46,000

While the total trade volume hit $2.3 billion, The co-founder of Onchain Capital and the founder of Crypto Banter, Ran Neuner, revealed a less positive facet of the GBTC figures. The underwhelming performance of Spot Bitcoin ETFs on their first day prompted inquiries concerning the elements behind the poor reception.

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Market participants and experts accused several factors, such as investor sentiment, regulatory uncertainty, and general market circumstances, of being possible causes for the low reaction. The price of BTC increased close to $49,000, only to return to $46,000 after 3 hours. As of press time, the BTC trades at $45,991.

In another conflicting note, the price of BTC moved between  $48,969 and $45,620 within 24 hours. BTC trading volume has also dropped in the last 24 hours, an activity linked to the declining interest in traders. Before the spot BTC ETF approval, the different analyses predicted that the BTC would hit $50,000. As it stands, sentiment around the BTC is expected to result in a pullback by next week. 

ETF Earlier Difficulty Explained, Onchain Capital Co-founder Comments

Elevated costs turned off potential investors and resulted in large outflows, which was one major factor affecting the GBTC’s results. The dynamics were further influenced by the locking up of earlier Bitcoin, which restricted the influx of fresh funds into the trust.

These difficulties highlighted the complex interplay in the cryptocurrency ecosystem between investment products, fees, and market dynamics. On his official X handle, Ran Neuner said that the BTC ETF’s first day can be considered “terribly unsuccessful.” Ran believes that some media houses report the $4.5 billion recorded in the overall trading without analyzing the actual data.

Seyffart Optimistic About ETF Prospect, BTC Grows By 0.77%

While explaining the trend, Reuter’s Hannah Lang and Suzanne McGee added that the story of Spot Bitcoin ETFs’ development and eventual adoption in the more extensive financial system will continue to be dynamic, influenced by factors such as investor mood, market forces, and continuous regulatory developments.

 James Seyffart, an ETF analyst with Bloomberg, noted a massive sell-off of the GBTC and a rise in purchasing another spot BTC ETFs. Seyffart has remained hopeful that the BTC ETF will remain formidable, considering the huge demand it got before its official launch. 

Investigation into the past activities of the ETF shows that the previous announcement saw the price of BTC attain its all-time high in December 2021. Currently, it went up by just 0.77%, representing $46,303. According to data from CoinMarketCap, Ethereum had a 2.79% increase, meaning $2597.95.

Maria Bartiromo

Maria Bartiromo

Maria Bartiromo is a renowned news writer and journalist, celebrated for her insightful reporting and authoritative voice. With a career spanning years, she has established herself as a trusted source of accurate and comprehensive news analysis, keeping readers informed on vital global developments.

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