Bitcoin’s recent surge, hitting a two-year peak, seems short-lived as the initial thrill of cryptocurrency-based ETFs starts fading. After the historic launch of these funds, Bitcoin experienced a noticeable pullback, dropping by 6.8% to $43,179.Â
Consequently, this downturn also affected other major cryptocurrencies like Cardano, Solana’s SOL, and Avalanche, all witnessing similar declines.
Strong Start but Subdued Follow-Up
Despite the subdued market response, the ETF launch was significant, with the first trading day seeing a remarkable $4.6 billion in shares traded. Grayscale Bitcoin Trust led with an unprecedented $2.3 billion turnover.
The Bitwise Bitcoin ETF emerged as a frontrunner among the new ETFs, amassing nearly $240 million in inflows. Following closely were Fidelity’s Wise Origin Bitcoin Fund and the iShares Bitcoin Trust.
These figures, however, only partially capture the picture, as complete flow data is still awaited.
Moreover, the Bitcoin ETF market’s success has sparked discussions about an Ether-backed equivalent. However, given its yield-generating features, regulatory debates around Ether’s classification as security add complexity to the scenario.
The Bitcoin market, hence, stands at a crossroads. While the ETFs’ launch marks a milestone, the subsequent market reaction underscores cryptocurrency investments’ volatility and unpredictability.
Also Read: SEC’s Gensler Acknowledges Irony in Bitcoin ETFs
