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Bitcoin Beats Silver To Become Second Largest ETF Commodity In The USA
Bitcoin has overtaken silver, becoming the second-largest exchange-traded fund (ETF) commodity in the United States in terms of assets under management (AUM).
This leap happened within just a week of trading for Bitcoin ETFs.
Jag Kooner, the Head of Derivatives at Bitfinex, attributed this surge to the high market interest and strong demand for cryptos like Bitcoin.
Silver, once the second-leading single commodity ETF in AUM, now ranks third with approximately $11.5 billion across five ETFs.
In contrast, Bitcoin ETFs, including Grayscale’s GBTC trust conversion, collectively hold about 647,651 Bitcoins, valued at $27.5 billion.
Grayscale’s Bitcoin Trust ETF (GBTC) is a significant player, holding around 619,000 Bitcoins.
This places it well above silver but still behind gold, which tops the chart with $96.3 billion in AUM across 19 ETFs in the U.S.
The transformation of Grayscale’s Bitcoin trust into an ETF was a pivotal moment, creating the world’s largest Bitcoin ETF overnight.
This move mirrored the intense demand for such products, contributing to market liquidity and stability.
Trading statistics reflect this trend.
Within five days of these new assets trading, their cumulative volume surpassed $12 billion.
This data, sourced from Yahoo Finance and compiled by The Block, indicates a sustained interest in Bitcoin ETFs.
Analysts like Kooner anticipate this interest to persist, due to competitive fee structures and waivers introduced by ETF issuers.
These strategies could draw more investors and incite further price competition among ETF providers.
Though many in the investment community still perceive cryptocurrencies as higher risk, the success of Bitcoin ETFs might open doors for more innovative crypto ETFs and potentially new underlying assets like Ethereum’s token next.
The growth trajectory of Bitcoin ETFs signals a shift in the asset investment landscape, reflecting an increasing acceptance of cryptocurrencies in mainstream finance. Read more here.
Demystifying Bitcoin ETFs: Potential game changer for crypto and potential benefits for Zucoins.
What’s Happening With ETFs And Bitcoin’s Price? Can Zucoin’s No In-Built Fees Help?
The recent milestone of Bitcoin surpassing silver to become the second-largest ETF commodity in the U.S. signals a seismic shift in the landscape of digital assets.
However, there’s been some confusion regarding the dip in Bitcoin’s price since the recent ETF listings were approved.
A statement from major US bank JPMorgan goes into the details of what’s actually happening with Bitcoin’s price and is well worth a read if you’re interested in the finer specifics.
It seems this was due to long-term investors releasing their locked-up Bitcoin from within Grayscale’s Trust—one of the original firms that campaigned for the Bitcoin ETFs.
Many of Grayscale’s participants purchased crypto on leverage, many years ago when leveraged loans were cheaper, and they now have a chance to liquidate their assets given the current higher economic interest rate environment.
Another side is that many are now moving or purchasing these Bitcoin via the newer and much lower fee ETFs.
Grayscale’s Bitcoin Trust (GBTC) still has higher fees than other recently approved ETFs, as their “fee at 1.5% still looks too high compared to other spot Bitcoin ETFs risking further outflows (selloffs).”
JPMorgan, the major US bank reported that most of the $3 billion of inflows (buys) into Bitcoin ETFs also indicate a rotation from existing Bitcoin investment methods, such as the older, previously approved futures-based ETFs, into the recently approved spot ETFs (where you buy Bitcoin but another company holds it for you).
Analysts expect more Bitcoin outflows to come if these older funds don’t reduce their fees.
Back to Bitcoin ETFs overtaking Silver ETFs—and what it means.
This achievement is not just a testament to Bitcoin’s growing mainstream acceptance but also a signal for the wider crypto industry.
The surge in Bitcoin ETFs could underlie a growing appetite for alternative investments, such as cryptocurrencies.
This is where Zucoin, with its unique approach to transactional efficiency and security via its Splitchain network, can carve out its own position in the space.
The competitive fee structures mentioned by Kooner in the context of Bitcoin ETFs are another area where Zucoin can excel.
Given its cost-effective transaction model, Zucoin could attract a broad base in environments where every 0.01% in fees matters against the competition, especially those dissatisfied with the higher fees associated with some traditional ETFs and other cryptocurrency platforms.
Moreover, the potential for innovation in digital contracts, including those based on digital assets, opens the door for all kinds of Smart Assets to be created on top of the Splitchain network.
Splitchain offers unique benefits like enhanced safety via two-factor transactions, ease of use and no in-built transaction fees, positioning it as an innovative and differentiated cryptocurrency option.
The rise of Bitcoin ETFs is not just a milestone for Bitcoin but a beacon for the broader cryptocurrency market, including next-generation crypto technologies like Zucoin and Splitchain.
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All the best,
—Rob
MyZucoins
Disclaimer: Of course, this is not advice, financial or otherwise. It’s also important to consider the risks and challenges associated with any potential benefits.