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On Thursday, the U.S. spot Bitcoin exchange-traded funds (ETFs) surpassed a significant milestone, reaching over $750 billion in cumulative trading volume since their introduction in January 2024, The Block reported.
The rapid growth in trading volume was initially fueled by Bitcoin’s surge to new all-time highs of nearly $74,000, with the ETFs hitting $100 billion in March 2024 and $200 billion by April of the same year.
The trading volume’s increase slowed during a period where Bitcoin’s price consolidated between $50,000 and $70,000. Momentum picked up again following the U.S. presidential election victory of Donald Trump on November 6, with the spot Bitcoin ETFs crossing the $500 billion mark shortly thereafter. As of the close of trading on Thursday, the cumulative volume stood at $753.2 billion, showcasing the popularity of these funds among investors.
BlackRock (NYSE:BLK)’s IBIT has emerged as the dominant player in the U.S. spot Bitcoin ETF market, commanding over 75% of the market share by trading volume as of February 20. Initially, Grayscale’s converted GBTC fund held an advantage, but IBIT has since overtaken it, with The Block’s data dashboard indicating IBIT’s assets under management (AUM) at $56 billion out of the total $112 billion in AUM for spot Bitcoin ETFs.
Despite the overall success, spot Bitcoin ETFs experienced $886 million in net outflows this month, with a significant $365 million withdrawn on Thursday alone. This occurred amidst a downturn in Bitcoin’s price. In contrast, spot Ethereum ETFs, which launched in July 2024, have seen $404 million in net inflows this month, despite having added a total of only $3.2 billion in flows since their inception.
Valentin Fournier, an analyst at BRN, commented on the situation, noting a divergence in institutional flows between Bitcoin and Ethereum ETFs. Fournier observed that while Bitcoin ETFs faced escalating outflows, Ethereum experienced more modest outflows, suggesting a potential reversal in market sentiment. He also pointed to a pause in institutional outflows over the weekend and Bitcoin’s breakout from its recent price range, indicating the possibility of further market gains.
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