Recent hints that U.S. regulators may soon approve a spot price Bitcoin exchange-traded fund (ETF) is boosting more than just Bitcoin price but also the cryptocurrency ecosystem.
Institutional investors, as well as everyday traders, are showing renewed interest in investment options tied to cryptocurrencies.
According to senior ETF analyst Eric Balchunas of Bloomberg, two major but controversial Bitcoin investment options saw a spike in trading volume last week amid the fresh spot ETF buzz.
One of them, the ProShares Bitcoin Strategy ETF (BITO), which received approval as a future-based ETF in the U.S. in 2021, traded $1.7 billion last week, marking its second-highest volume since its launch.
Balchunas tweeted,
“That’s $2.5b (top 1% among ETFs) into two less desirable methods (vs spot) for exposure = while we think spot ETFs unlikely to set records on DAY ONE, clearly there’s an audience,” .
Meanwhile, the Grayscale Bitcoin Trust (GBTC), as highlighted by Balchunas, also witnessed an increase in trading activities during this period, accumulating over $800 million in trading volume.
This increased interest helped narrow the gap between GBTC’s share price and the spot price of Bitcoin to its lowest level in two years.
GBTC now trades at only a 13.1% discount to the actual Bitcoin spot price, a significant improvement.
Furthermore, William Clemente, co-founder of crypto research firm Reflexivity, noted that ETF trading is back in full steam.
