- BlackRock and Fidelity’s new spot bitcoin ETFs saw nearly $1 billion in trading volume on the first day of trading, emerging as early winners.
- Industry analysts predict new spot bitcoin ETFs could attract $50-100 billion in fresh capital in 2023, reflecting pent-up demand from asset managers.
- Early trading volume confirms significant latent demand, though future inflows depend on investor education and advisor embrace of these new products.
After months of anticipation, the SEC finally approved several spot Bitcoin ETFs on January 11, 2023. These new financial instruments allow mainstream investors to gain exposure to Bitcoin prices without having to directly own the digital asset.
In the first day of trading, two giants of Wall Street – BlackRock and Fidelity – emerged as early winners. Their spot Bitcoin ETFs saw a combined $958 million in trading volume as of 11:10 am EST. Given these are brand new ETFs, it’s likely most of that volume represents fresh inflows rather than outflows.
Grayscale’s spot Bitcoin ETF, converted from its existing Bitcoin trust, saw around $1 billion in volume. However, it remains unclear how much of that reflects new investment compared to redemptions.
Other new entrants, like the ARK 21Shares Bitcoin ETF, saw more modest volume of $148 million. And some products, including those from Franklin Templeton and Valkyrie, had less than $10 million on day one.
Massive Pent-Up Demand Could Unleash a Tidal Wave
Industry analysts have predicted the new spot Bitcoin ETFs could usher in $50-100 billion in fresh capital during 2023. This estimate reflects the pent-up appetite among conventional asset managers to gain Bitcoin exposure for their clients.
After years of rejection, the SEC’s approval opens the floodgates. The bounce in Bitcoin’s price following the news underscores the crypto market’s enthusiastic response.
Of course, predicting future inflows involves some guesswork. Much depends on investor education and advisors embracing these products. However, early trading volume confirms significant latent demand.
If even a fraction of the optimistic projections materialize, spot Bitcoin ETFs will fundamentally reshape the cryptocurrency industry. The resulting mainstream adoption could cement Bitcoin’s place in modern finance.