The introduction of spot Bitcoin ETF products has sparked a surge in the cryptocurrency market, increasingly attracting investor attention and overshadowing traditional investment vehicles. An analyst highlighted the rise in outflows from European Bitcoin-based products following the launch of spot Bitcoin ETFs in the U.S.
Luke Nolan, a researcher at CoinShares, emphasized a shift in U.S. institutional investors’ strategies towards newly approved spot Bitcoin ETF products. He noted significant outflows from European Bitcoin ETFs as U.S. institutions previously preferred European ETPs for nearly risk-free basis trades.
According to Nolan, these basis trades offered U.S. institutional investors a relatively risk-free investment opportunity. He explained that investors were shorting Bitcoin futures while simultaneously buying the underlying asset through European ETPs, capitalizing on the premium difference, but now they can do so more efficiently with U.S. spot Bitcoin ETF products.
Data from BitMEX Research indicated significant outflows from Europe’s largest four Bitcoin ETP products since the launch of spot Bitcoin ETFs. The analysts suggested a shift away from higher-fee Bitcoin ETP products in Europe.
Canada, an early adopter in the spot Bitcoin ETF space, also observed notable outflows from Bitcoin ETP products. Nolan mentioned that U.S. investors with access to Canadian ETPs are transitioning to new U.S. funds.
