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Spot Bitcoin ETFs Day Five: Issuers add 10,600 BTC

Last Updated January 19, 2024 8:17 AM
Teuta Franjkovic
Last Updated January 19, 2024 8:17 AM

Key Takeaways

  • Spot Bitcoin ETFs are experiencing strong demand from investors.
  • Bitcoin ETFs are attracting significant capital inflows.
  • A prominent investor’s sale of large BTC stack on January 12 triggered widespread market panic.

The newly introduced Bitcoin exchange-traded funds (ETFs) in the United States have quickly become a focal point for investors.

On their fifth trading day, issuers of spot Bitcoin exchange-traded funds (ETFs) acquired an additional 10,667 Bitcoin. A fall in BTC’s price to $41,434 reflected this.

Spot Bitcoin ETFs Accumulate $440 Million Despite GBTC Outflows

According to data from , issuers increased their Bitcoin holdings by a net $440 million by the day’s end. A significant portion of this accumulation, involving 8,700 BTC valued at nearly $358 million, was attributed to BlackRock’s ETF. 

Furthermore, the data reveals that since their inception, nine ETFs (excluding Grayscale) have amassed close to 68,500 BTC.  This is now worth about $2.8 billion.

This recent uptick in Bitcoin acquisitions linked to ETFs was balanced by withdrawals from the Grayscale Bitcoin Trust (GBTC) . GBTC saw an outflow of 10,824 BTC, worth about $445 million. Since its transformation into a spot ETF on January 11, almost 38,000 BTC has been withdrawn from GBTC.

‘Newborn Nine’ Bitcoin ETFs Witness 34% Surge in Trading Volume

Bloomberg analyst Eric Balchunas shared data highlighting among the ETFs, which he nicknamed the “Newborn Nine.” These ETFs, all excluding GBTC, experienced a 34% surge in their daily trading volume by their fifth day of trading. 

He said:

“Normally with a hyped-up launch you see volume steadily decrease each day post-launch, rare to see it reverse back up.”

It’s important to consider that the data concerning Bitcoin purchases as reported by ETF managers typically lags behind the actual transaction volume figures for each fund. This is mainly due to the time it takes to complete purchase settlements .

Reflecting the growing interest of investors in these products, the Bitcoin ETFs managed by BlackRock and Fidelity each amassed more than $1 billion in assets under management (AUM) at close of trading on January 18. This information is based on data provided by Bloomberg ETF analyst James Seyffart.

Bitwise Leads in Reporting Bitcoin Holdings with Major Addition

Balchunas also that the Bitcoin ETFs managed by BlackRock and Fidelity have achieved significant prominence in terms of capital inflows. They are currently ranked fourth and fifth, respectively, for weekly capital inflows among all US ETFs. This places them just behind the  Vanguard 500 Index Fund ETF, which replicates the performance of the S&P 500 index, encompassing the 500 largest publicly traded companies in the United States. 

CC15Capital said  that, as of January 19, Bitwise was the sole asset manager to have reported its Bitcoin holdings for January 18. On that day, Bitwise added an additional 491 BTC to its portfolio.

Bitwise CEO Hunter Horsley expressed gratitude  in a tweet, saying, “+$20,000,000 into BITB today.”

He acknowledged the responsibility and trust placed in his company to manage client assets effectively.

Bitcoin experienced a decline of less than 1% on January 17. However, in the following 24-hour period, the cryptocurrency witnessed a more significant drop , with its value sliding over 3.8% to $41,417.

Key Investor’s BTC Dump Triggered Jan. 12 Price Crash, Analyst Says

Analyst James Van Straten on the  significant drop in Bitcoin’s value on January 12, marking its largest single-day fall since the FTX collapse. He attributed this downturn to the actions of a prominent investor, or ‘whale,’ who acquired more than 100,000 BTC during the 2021 bull run at approximately $48,000 per Bitcoin. 

Contrary to Van Straten’s expectations of the investor holding onto their assets due to a 75% unrealized loss, the investor sold their holdings when Bitcoin’s price briefly rose to $49,000 in 2024. This unexpected move triggered widespread market panic, exacerbating the situation with a mix of liquidations, a “sell the news” mentality, and record loss-taking among investors.

Van Straten also with the activity surrounding the  Grayscale Bitcoin Trust (GBTC). 

He noted that GBTC offloaded only 27,000 Bitcoin, despite witnessing a comparable influx into the ETFs. He suggests this volume of sales is insufficient to have caused such a market impact.

Furthermore, he raised doubts about whether FTX has liquidated its GBTC position yet, implying more market movements could be on the horizon if such an event were to happen.

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