Bitcoin has managed to gradually but successfully penetrate the stock market over the years; the best example is the Grayscale Bitcoin Trust (GBTC). But the relevant question here is, how well did it actually go?
Bitcoin and ETFs
Bitcoin Exchange Traded Funds (ETFs) have long been one of the most anticipated new additions to the crypto space. After its creation, a huge impact on the Bitcoin market was registered.
In the first week after its launch, inflows soared, reaching approximately $ 1.46 billion. But within the next week the hype lost momentum, and the inflows brought in only $ 287 million.
ETF inflows | Source: CoinShares
However, there is another reason why it hasn’t hit higher highs in the past week. First, BTC hit its all-time high of $ 65.9,000 in the same week that the ETF was launched. But the next week passed without much movement.
Bitcoin price promotion | Source: TradingView – AMBCrypto
However, this is in some ways evidence of how much people actually needed an ETF and how badly they wanted one just because everyone else was hyping it.
However, other countries continue to follow this hype by allowing local ETFs. Australia, which is the last on this list with its BetsShares Crypto Innovators ETF (CRYP), is scheduled to be listed on the ASX on Thursday. However, the US SEC itself is holding back the approval of ETFs.
The Securities and Exchange Commission has again postponed its decision on the Valkyrie ETF by extending the deadline to January 7, 2022 Additionally, GBTC, which has over $ 40.4 billion worth of BTC under its management, intends to launch its spot ETF potentially by June 2022. This is cause for concern as it would be the first of its kind as all of the others are primarily based on futures.
The effect of ETFs on investors was rather unclear. Since the beginning of this month, a large number of retailers have left the market after cashing in profits. While richer cohorts (> 100 BTC) suddenly became quite active.
Bitcoin rich addresses | Source: Glassnode – AMBCrypto
Retailers could potentially return if Bitcoin rises again or if there is a significant development in the market, like the recent announcement by CBA that it will offer crypto services to its customers.
However, the January decision on the Valkyrie ETF will be the real trigger for the revival of the ETFs.
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