Spot bitcoin exchange-traded funds (ETFs) saw their trading volume rise to a record $111 billion in March, nearly triple the $42 billion traded in February.
Approved earlier this year by the SEC, US spot bitcoin ETFs have quickly gained traction among investors. Its volumes last month exceeded even the most optimistic expectations.
<blockquote class="twitter-tweet”>
NEW: twitter.com/hashtag/bitcoin?src=hash&ref_src=twsrc%5Etfw”>#bitcoin ETFs saw record volume of $111 BILLION in March.
That's TRIPLE the number of entries since February pic.twitter.com/Ol1PaS8vC9
– bitcoin Magazine (@BitcoinMagazine) twitter.com/BitcoinMagazine/status/1775472330187440278?ref_src=twsrc%5Etfw”>April 3, 2024
According to Bloomberg ETF Analyst x.com/EricBalchunas/status/1775147839498207695?s=20″>Eric Balchunas, March trading volume was approximately triple that of February and January. The massive rise indicates that spot bitcoin ETFs are meeting strong demand from institutional and retail investors.
He said: “I can't imagine April will be any bigger, but who knows.”
BlackRock's bitcoin ETF (IBIT) led the pack, capturing 50% of the total volume. Grayscale's GBTC came in second with 20%, while Fidelity's FBTC followed with 17%.
Balchunas declared IBIT the “$GLD of bitcoin,” referring to the giant SPDR Gold ETF. He said his March victory makes IBIT the undisputed leader among bitcoin ETFs.
The increase in trading activity aligns with bitcoin's rise to new all-time highs in March. However, it also suggests that spot ETFs are altering market dynamics and driving new demand.
Critics initially argued that bitcoin markets would ignore the new products. However, flows into funds like IBIT and FBTC have been overwhelmingly positive.
Demand is far outpacing mined bitcoin. ETFs bought around 66,000 btc in March, while miners only produced 28,500. This supply and demand imbalance appears poised to grow as more investors gain exposure through ETFs and newly mined coins halve in two weeks during the bitcoin halving event.
With strong inflows, assets under management and trading activity, these new regulated instruments have firmly established themselves in the bitcoin markets. If March was any indication, his rise is just beginning.
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