Originally published on: August 05, 2024
In the midst of a volatile crypto market, Bitcoin exchange-traded funds (ETFs) have seen a significant surge in trading volume, surpassing the $1 billion mark on August 5. The rapid increase in trading activity was noted by Alex Thorn, head of research at Galaxy Digital, on the X platform.
ETF Trading Volume Soars Past $1 Billion
Within just 20 minutes of trading, Bitcoin ETFs witnessed a trading volume exceeding $1.3 billion. Notably, the iShares Bitcoin Trust emerged as the leader in trading activity, with volumes exceeding $875 million.
Investor Interest Spurs Inflows Amid Market Dip
Thorn predicts that Bitcoin ETFs will attract net inflows from investors looking to capitalize on the recent approximately 8% downturn in spot BTC prices since August 4. This market dip was primarily driven by a substantial decline in Ether prices, plunging over 21% as reports revealed extensive selling by funds like Jump Trading and Paradigm VC.
Market Turbulence and Investor Sentiment
Jump Trading’s sell-off of over $377 million in ETH, with potential intentions to liquidate up to $481 million, contributed to the overnight market turmoil. The broader macroeconomic landscape, including a 5% decline in the S&P 500 stock index since August 1, has further exacerbated market volatility.
The report highlighted that global macro sentiment has soured, fueled by negative US unemployment data and widespread asset unwinding, leading to heightened market volatility. Japan’s recent interest rate hike added to the instability, prompting traders to swiftly readjust positions.
Anticipating Market Stabilization
Markus Thielen, founder of 10x Research, anticipates a slowdown in new crypto investments until market conditions stabilize. As regulatory and economic factors continue to influence the crypto landscape, investors are advised to exercise caution and closely monitor market developments.
Stay informed about the latest updates in the world of cryptocurrency by following our platform.
