New record for spot Bitcoin ETF trading

Yesterday, it was another record-breaking day for spot Bitcoin ETF trading.

Taking into account only new ETFs on US stock exchanges, daily trading volume exceeded nine and a half billion dollars.

Trading volumes on spot Bitcoin ETF trading

In particular, three of these ETFs alone exceeded two billion in daily volumes: BlackRock’s IBIT, Grayscale’s GBTC and Fidelity’s FBTC.

It should be noted that on the first day of listing on the stock exchange, January 11th, adding up all the daily trading volumes of all the new Bitcoin ETFs with the exception of GBTC, they just exceeded two billion dollars, and even then it seemed to be a success.

Yesterday IBIT alone exceeded 3.7 billion, which is almost double what happened on January 11th.

Even GBTC, which had lost many volumes over the weeks, yesterday recorded its new historic high from this point of view, with 2.9 billion which also exceeded the 2.2 of January 11th.

As regards the BlackRock ETF, it has actually been setting new records since February 26th.

After the billion dollars of trade on the first day, and the decline in the following days, on February 26th it rose to 1.3 billion, and on the 28th it had even risen above 3.3.

On Monday it had again touched 2.5 billion dollars, and yesterday it recorded its new maximum record above 3.7 billion.

These are record volumes, as far as the trading of a single ETF is concerned, but also overall, Bitcoin ETFs are recording record trading volumes on the stock exchange at an asset class level.

Grayscale

Yesterday, however, what surprised the most was Grayscale’s GBTC.

In fact, after the 2.2 billion dollars of trading volume on January 11th, it had even fallen below 320 million on February 23rd.

Furthermore, until the 28th it had not yet exceeded one billion.

On Monday it had risen above 1.8 billion dollars, and yesterday it jumped to 2.9.

This latest leap seems almost sensational, but it must be seen in context.

GBTC has been around for more than ten years, but not in the form of an ETF. When it was still just an OTC-only fund, it managed to accumulate around 620,000 BTC, but with a strong discount on the NAV due to the impossibility of withdrawing the shares on the market.

With the transformation into ETF they were finally able to start withdrawing shares from the market and partially selling the collateral. They have since sold more than 200,000 BTC, or just under a third of what the fund held as of January 10th.

At first they even sold up to more than 10,000 BTC per day, but starting from the end of January the sales pace dropped to reach 428 BTC on February 27th.

At that point, however, the repayment of the shares started again, and they went back to having to sell up to almost 10,000 BTC in one day, with 13,000 BTC sold this week alone.

The fact is that on GBTC shares there is a commission that is three times as much as that on IBIT, so whoever owns those shares is better off selling them to buy those of other ETFs.

In fact, from January 11th to today, IBIT and FBTC alone have acquired a total of 280,000 BTC, which is many more than the 205,000 sold by GBTC.

The impact on the price of Bitcoin

These dynamics are also having an impact on the price of Bitcoin.

However, what happened yesterday in the crypto markets may have little to do with ETFs. Perhaps instead it was the ETF market that was influenced by what was happening on the crypto markets, especially in terms of volumes.

On Sunday, the price of Bitcoin, already high, was around $62,000.

However, crypto markets started to move on Monday, with BTC rising to around $65,000.

These two levels seem to be important at the moment, because yesterday Bitcoin first made a sensational leap up to above $69,000, recording the new maximum value ever, but only to then immediately drop below $62,000.

However, once it fell below this threshold it recovered almost immediately, and then during the night it rose again above $65,000.

These dynamics are typical of the price of Bitcoin, and certainly not of the classic performance of ETFs. However, such volatility has also attracted speculators to traditional stock exchanges, where ETFs are traded.

Furthermore, the recovery of the $65,000 occurred when US stock exchanges were closed, so it certainly cannot be due to the ETFs.