The Bitcoin ETF started trading on January 11, and the crypto market continues to witness its implications. Following the launch of the Bitcoin ETF, issuers engaged in aggressive competition over fees. Many entered into a price war, attracting investors with lower fees and promotional periods with waive-offs.
Meanwhile, the trading of the much-awaited spot Bitcoin ETF led to the slight price rise of Bitcoin in the beginning. While investors were awaiting it to surpass the $50,000 mark, its price dipped the following day.
Bitcoin’s price movement
Bitcoin’s sluggish price action continues with the king coin falling under $40,000 on January 22. Most analysts do not see BTC’s underwhelming price action as a matter of concern just yet. Meanwhile, the Bitcoin ETFs managed to get just under $20 billion in trading volume in the last week, as per data by Bloomberg.
As a result of the significant trading volume, Bitcoin also managed to surpass Silver as the second-largest commodity ETF player. Now, the king coin is just behind Gold in the commodities market.
Also Read: Bitcoin Price: Will Bitcoin Price Fall Below 34k This Month?
GBTC outflows concern the market
However, what concerns the market is Grayscale’s market dominance, which lasted only one day. On Monday, Grayscale’s GBTC witnessed an outflow of $640 million, contributing to its total net outflow of $3.4 billion, amidst a broader market downturn.
Source: Arkham Intelligence dashboard
According to Bloomberg’s Eric Balchunas, GBTC has experienced a 13% reduction in its outstanding shares as of Tuesday.
Despite this, the introduction of the Bitcoin ETF clears the ground for more potential crypto ETFs in the upcoming days. The conversation around the approval of Ethereum ETF, with the SEC’s decision deadline set for May, has gained steam.
This also represents a significant stride toward the broader adoption of cryptocurrency and increased participation from new investors. Bitcoin has achieved a degree of legitimacy within the space of regulated finance, which could pave the way for greater acceptance, among both users and regulators.
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