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Investors placed $1 billion in Bitcoin ETFs in two days. What will happen to the crypto market?


Investors placed $1 billion in Bitcoin ETFs in two days. What will happen to the crypto market?

Assets under the management of the first US exchange-traded fund based on bitcoin futures exceeded $1 billion. Will institutional players continue to invest in Bitcoin Strategy ETF, and how will this affect the value of the cryptocurrency?

In two days of trading, assets under the management of the Bitcoin Strategy ETF (ticker BITO) of ProShares exceeded $1 billion. The fund broke the record for the growth rate to $1 billion, which was held for 18 years. Until today, the leadership belonged to the “gold” exchange-traded fund (ticker GLD) – it managed to reach $1 billion in three days in 2004.

The Bitcoin Strategy ETF is the first U.S. exchange-traded fund based on bitcoin futures from the Chicago Mercantile Exchange (CME Group) and approved by the Securities and Exchange Commission (SEC). Trading Bitcoin Strategy ETF started on October 19 on the New York Stock Exchange (NYSE). On October 21, it became known that the SEC approved two more exchange-traded funds based on bitcoin futures from VanEck and Valkyrie Invesments.

On October 20, the price of bitcoin renewed its all-time high above $ 67 thousand. As of this writing, on October 21, the asset is trading at $ 65.9 thousand. Its capitalization is $ 1.22 trillion, according to CoinGecko. During the day, the cryptocurrency has risen in price by 3%.

Analysts at investment bank JPMorgan believe that the reason for the new all-time high in bitcoin is not the launch of the first bitcoin ETF in the United States, but the rise in inflation. The bank claims that the Bitcoin Strategy ETF is unlikely to attract a lot of funds into the first cryptocurrency.

Bitxmi experts predicted whether the popularity of cryptocurrency exchange-traded funds will grow in the future and how this could affect the digital asset industry.

Institutional Investor Inflow

Bitcoin ETF will definitely be in demand from investors and will increase the number of institutions in the cryptocurrency industry, BitXmi analysts are confident. Thanks to the exchange-traded fund based on bitcoin futures, investors have received a regulated asset related to cryptocurrency, which can be accessed without any additional conditions directly from the trading terminal.

“In the coming year, the number of ETFs and regulated crypto products will increase, which will allow the digital asset market to be re-capitalized by 2-3 times, to a level of $ 7-8 trillion,” experts predict.

The popularity of cryptoasset ETFs among investors will continue to grow. The pace of investing in bitcoin ETFs could slow reports of US stimulus rollbacks, but it will affect all financial instruments, not just cryptoassets and related products.

What will happen to the crypto market?

SEC approvals for several more applications to launch bitcoin futures ETFs were expected by the cryptocurrency community. This will be another trigger for market growth. The record set by the Bitcoin Strategy ETF from ProShares in the first two days of trading supported Bitcoin’s uptrend, which was the reason for its new all-time high.

Taking into account the increase in the number of new market participants through new crypto products, the bitcoin price will continue to grow against the background of capitalization growth. According to the experts’ forecast, in the next couple of months, investors continued to actively buy digital assets, since the launch of the first Bitcoin ETF in the United States is more significant than the start of Bitcoin futures trading on the Chicago Mercantile Exchange in 2017.

Recall that in August 2021, the BitXmi crypto exchange launched the BXMI NFT Marketplace, where you can buy gold, silver, diamonds, and digital arts with zero fees.

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Disclaimer: Bitxmi News is a news portal and does not provide any financial advice. Bitxmi's role is to inform the cryptocurrency and blockchain community about what's going on in this space. Please do your own due diligence before making any investment. Bitxmi News won't be responsible for any loss of funds.

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