After years of delays and setbacks, the first Bitcoin-linked exchange-traded fund in the U.S., the ProShares Bitcoin Strategy ETF, made its debut Tuesday, marking a watershed moment for the crypto industry.
The fund trading under the ticker BITO rose as much as 5.4% to $42.15 before paring gains. It had been long-awaited by both the crypto community and investors on Wall Street, many of whom have argued for years that a Bitcoin-centric exchange-traded fund was overdue.
The ProShares fund is based on futures contracts and was filed under mutual fund rules that SEC Chairman Gary Gensler has said provide significant investor protections.
Just 20 minutes into its trading premiere, about 6.4 million shares of BITO worth roughly $264 million had changed hands, according to data compiled by Bloomberg.
Meanwhile, Bitcoin gained as much as 3.1% to trade around $63,274, slightly below its April record highs of just under $65,000.
Its an incredibly bullish week theres been really positive sentiment around the ETF in particular, said Sam Bankman-Fried, chief executive of exchange FTX.
Its long been assumed that whichever fund received approval first could stand to reap the greatest benefits including industry recognition as well as potentially attracting huge amounts of cash. Some analysts are already bullish on BITOs prospects the futures-based Bitcoin ETF could attract more than $50 billion in inflows in its first year given the hype around it, predicted noted Bitcoin bull Tom Lee, co-founder of Fundstrat Global Advisors.
There are other applications for futures-based Bitcoin ETFs in the queue. Analysts are anticipating launches from issuers such as Valkyrie, whose Bitcoin Strategy exchange-traded fund, due to debut on Wednesday, will nowtradeunder the ticker BTFD.
Meanwhile, Grayscale Investments and the New York Stock Exchange filed to convert the worlds biggest Bitcoin fund (GBTC) into an ETF, appealing to regulators for approval just as its wildly popular vehicle is beset with competition.
Market-watchers have a few measuring sticks with which to gauge BITOs initial reception. The SPDR Gold Shares fund (GLD) had the fastest-ever climb to $1 billion in assets under management, reaching the landmark in just three days, according to Bloomberg Intelligence. More recently, the VanEck Social Sentiment fund (BUZZ) saw more than $400 million worth of shares traded on its debut earlier this year, one of the highest amounts ever for an ETF on its first day.
Bloomberg Newsreportedlast week that the Securities and Exchange Commission wasnt going to stand in the way of the launch of a futures-backed Bitcoin fund.
Gensler has been viewed as being more open-minded about crypto than his predecessor, Jay Clayton. Observers cite Genslers previous interest in the crypto world he once taught a class at MITs Sloan School of Management called Blockchain and Money. And over the summer, Gensler hadsignaledthat regulators might be more open to a Bitcoin ETF if it were based around futures rather than the cryptocurrency itself.
[More: First US Bitcoin-linked ETF raises concerns for advisers]
The post Bitcoin futures ETF opens with gain, explosive trading volume appeared first on InvestmentNews.
We're here to help. Send us an email or call us at +1 (585) 329-9661. Please feel free to contact our experts.
A donation will be made by Adviser First Partners to a Veterans organization on behalf of all financial professionals and firms that register each month
Contact Us© 2024 Adviser First Partners. All Rights Reserved.
Web Design by eLink Design, Inc., a Kentucky Web Design company