Successful launch of Bitcoin ETFs?

Spot ETFs launched

What a week! Approval of the Bitcoin ETFs came Wednesday night, trading started right afterwards on Thursday. On day one there were inflows of more than 700 million dollars into these ETFs while Bitwise (IBIT) saw the biggest numbers, followed by Fidelity (FBTC) and Blackrock (IBIT).
The fees of these products are really low which was quite a surprise, starting from 0.19% annually (Franklin Templeton) and with zero fee discounts in many cases for the early investors.

Source: X/Bloomberg Intelligence

What we saw pricewise was Bitcoin rising towards the first trading day but now price has fallen more than -10% since. So other than what most people expected, including myself, it was a buy the rumor, sell the news event. No monster candle, no big pump.

Reason why

This had reasons. Obviously many investors used the ETF launch for a trade and took profits afterwards. In addition Vanguard closed off their customers to buy the Bitcoin products so a lot of people where not able to buy. And last but not least these inflows of 700 million dollars where not as high was many expected. There was rumors before of several billions waiting on the sideline.

Success?

In my view the approval itself is a huge success, making it easy for mainstream investors to get Bitcoin exposure and making it possible for institutions to get this asset since they are often simply not allowed by their compliance to open a wallet and buy some coins at Binance or Coinbase.
The inflows of billions will come imo but this will take some time. In the next weeks there will be a lot of advertising and talk on the street and in company meetings, people will make decisions step by step and parts of available assets will be invested into these ETFs. And don’t forget we have a halving soon! While demand is rising the supply will be cut in half.

What is your conclusion about the ETF launch?

Posted Using InLeo Alpha