Spot Bitcoin ETF products were launched on January 12, attracting investors’ attention despite initial uncertainty about market data and liquidity timelines. The products achieved a record-breaking $4.66 billion trading volume, raising questions about the potential impact on Bitcoin prices.
Prior to the ETF launch, Grayscale’s GBTC, holding over $27 billion in Bitcoin, faced criticism. In the first three trading days, GBTC experienced a net outflow of $1.17 billion, primarily occurring on January 13 and 16, which offset 86% of the inflows into other spot Bitcoin ETF products.
Data presented by Bloomberg’s senior ETF analyst Eric Balchunas showed a significant $782 million net inflow, mostly during the first trading session. Analysts suggest that most spot Bitcoin ETF inflows corresponded with outflows from Grayscale GBTC. Excluding the first day, products issued by BlackRock, Fidelity, Bitwise, Ark/21 Shares, Invesco, and others saw a net inflow of $157 million over two days.
Considering an $11.3 billion net outflow from GBTC and a hypothetical $13 billion net inflow into other spot ETF products, the expected price effect of a $1.7 billion growth in U.S.-listed spot Bitcoin funds seems negligible, given that trading volume on January 16 alone was $1.9 billion.
In the financial markets, it’s challenging to discern the intentions behind trades. Grayscale GBTC’s higher commission fee of 1.5% compared to competitors’ 0.25% or lower suggests a potential gradual shift of assets by investors. The ongoing demand for spot Bitcoin ETF products and the upcoming Bitcoin halving event in April may significantly alter the market dynamics.