Originally published on: August 06, 2024
Amidst market uncertainty on August 5, the exchange-traded funds (ETFs) for Bitcoin and Ether in the United States saw a significant uptick, reaching a combined trading volume of nearly $6 billion.
Bitcoin ETFs Leading the Way
As per data from CoinGlass, spot Bitcoin ETFs garnered a total daily trading volume of $5.24 billion on the same day. Notably, a substantial portion of this volume originated from BlackRock’s iShares Bitcoin Trust.
On the other hand, spot Ether ETFs achieved a trading volume of $715.3 million, with Grayscale’s Ethereum Trust and BlackRock’s iShares Ethereum Trust emerging as the primary drivers behind this figure.
Market Insights and Analysis
In a notable observation made earlier in the trading session, Bloomberg ETF analyst Eric Balchunas emphasized the significance of high trading volumes during turbulent market conditions. According to Balchunas, such “crazy volume” typically signifies prevailing fear in the market. On the contrary, he also highlighted the importance of ample liquidity during challenging market scenarios, a factor that traders and institutions appreciate about ETFs in the long run.
Market Fluctuations and Recovery
The crypto markets experienced a downturn on August 4 following reports of Jump Trading transferring a substantial amount of Ether to exchanges. This trend intensified the next day, with significant declines observed in the Nikkei and the Japanese yen carry trade, causing Bitcoin to briefly dip below $50,000 during US trading hours on August 5.
Despite these fluctuations, Bitcoin has shown resilience and has rebounded slightly, currently trading above $54,200.
ETF Inflows and Outflows Analysis
Preliminary data from CoinGlass suggests a mixed picture concerning inflows and outflows across Bitcoin and Ether ETFs. Notably, the Grayscale Bitcoin Trust and ARK 21Shares Bitcoin ETF experienced outflows of $69 million, while the Bitwise Bitcoin ETF and Grayscale Bitcoin Mini Trust recorded inflows of $2.9 million and $21.8 million, respectively.
Similarly, the Grayscale Ethereum Trust saw outflows of $46.8 million, with Bitwise and Franklin Templeton’s ETFs witnessing inflows of $7.2 million and $900,000, respectively.
Future Outlook
Despite the current scenario, Bloomberg ETF analyst James Seyffart remains optimistic about the outlook for Bitcoin ETFs. In a recent analysis, Seyffart predicts that Bitcoin ETFs will likely end up with a net inflow once the final data is accounted for.
As the market continues to navigate through fluctuations, the performance of Bitcoin and Ethereum ETFs in the US remains a focal point for investors and analysts alike.
Stay tuned for more updates on the latest crypto news and market trends!
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