Bitcoin is currently trading at over $47,000 after nearing $49,000 – responding to the bevy of Bitcoin ETFs that have commenced trading today.
Yesterday, the Securities and Exchange Commission approved the listing of eleven exchange-traded funds that represent spot Bitcoin prices.
Clear Junction Head of Banking Sasha Skoryk said the trading of Bitcoin ETFs is a watershed moment for the crypto industry and a significant step towards the institutionalization of crypto:
“This groundbreaking move, encompassing 11 applications from industry giants like Black Rock, Ark investments/21Shares, Fidelity, Invesco and VanEck, represents a game-changer that allows investors to gain exposure to bitcoin without direct ownership. With a decade in the making, these ETFs are poised to reshape the crypto landscape, injecting credibility, accessibility and potentially drawing substantial institutional capital into the market.”
Skoryk said the ETFs provide a greater legitimacy for crypto along with the regulatory frameworks being adopted around the world. This will engender clarity and confidence for both retail and institutional investors – moving crypto mainstream.
Jean-Baptiste Graftieaux, CEO of Bitstamp, echoed others in calling the BTC ETFs a milestone for the industry which will help investors who have been observing from a distance to participate in crypto markets.
“With a spot ETF being first listed in Europe in 2023, the industry will benefit from a more global, cohesive regulatory approach, with the potential for more digital assets to step into the ETF spotlight. However, the sector must collaborate effectively to guarantee that crypto ETFs are equipped with the necessary safeguards to prevent fraud, market manipulation and ultimately, protect investors,” said Graftieaux.
Fineqia International (CSE:FNQ) Research Analyst Matteo Greco predicted $4 billion of “cumulative assets under management” will soon flow into Bitcoin with the Bitcoin ETF approvals:
Greco said it is important to note that the approval also encompasses the conversion of Grayscale Bitcoin Trust (GBTC) into an ETF, which might result in an outflow from the product.
“GBTC currently holds over 600,000 BTC, and many customers were unable to redeem their shares in previous years due to the product’s structure. This conversion provides an opportunity for these customers to redeem their shares, especially considering the comparatively high fee announced by Grayscale compared to its competitors. Grayscale has announced a 1.5% management fee, while most competitors will have a management fee ranging between 0.2% and 0.3%. This discrepancy could lead to an initial outflow from Grayscale’s product in favour of competitors. However, the impact of this movement may be mitigated by the fact that redeeming shares from Grayscale would trigger a taxable event, potentially dissuading customers from making such a move.”
Jonathan Steinberg, WisdomTree Founder and CEO said the listing of their Bitcoin ETF was core to their heritage of innovation and disrupting financial services.
“Now, after years of experience meeting investors’ demand for a Bitcoin ETP in Europe, we could not be more thrilled to be at the helm of the movement to accelerate access to digital assets in the United States after years of engagement with U.S. regulators. While potential investors must carefully consider if the risk profile of a digital asset such as bitcoin has a place in their portfolio, we see this effectiveness as a major step in the industry evolution that we’re leading – where the blockchain is redefining the way we see finance today.”
Trading in the new ETFs are currently experiencing robust trading on their first day on exchanges.
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