BlackRock‘s Bitcoin ETF IBIT has maintained its lead in total volume on the third day of trading, generating buzz about its potential to become the largest holder of Bitcoin (BTC).
In the competitive race among the newly launched Bitcoin spot ETFs — dubbed the “Newborn Nine” — day three saw a total volume that matched industry expectations, hovering around the $500 million mark, based on the latest market data available on Jan. 16.
This is a continuation of the robust performance seen in the days following the highly anticipated launch of these investment vehicles.
BlackRock building BTC hoard
According to Bloomberg’s ETF analyst Eric Balchunas, BlackRock’s position is strengthening, and it’s a question of “when,” not “if” they will surpass tech giant MicroStrategy in Bitcoin holdings.
Balchunas’s insights have sparked conversations among investors, with many keenly observing BlackRock’s aggressive moves in the cryptocurrency space.
The BlackRock iShares ETF, with its impressive inflow and volume numbers, is currently poised to challenge the Grayscale Bitcoin Trust (GBTC), which is currently considered the ‘Liquidity King’ due to its long-standing presence in the market and a significant amount of holders.
IBIT recorded significant flows in the first two days of approximately $497.7 million, resulting in BlackRock scooping up roughly 11,500 BTC for its fund.
Fidelity Investments’ FBTC closely followed IBIT’s lead with notable total flows of $422.3 million over the same period. The ETF has also maintained its trading volume, which stood at $170.1 million on day three.
The two ETFs together made up over $3.1 billion of the total trading volume so far, with most of these being inflows.
Meanwhile, the two established ETFs — GBTC and ProShares’ BITO — made up over 60% of the total volume with $4.65 billion and $3.26 billion, respectively. Despite the high trading volume, the two ETFs have mostly recorded outflows as investors sell after recovering the losses from the past year.
Surpassing the benchmark
The success of these new Bitcoin ETFs, particularly in comparison to the launch of ProShares’ BITO ETF, indicates a maturing market increasingly receptive to cryptocurrency as an investment vehicle. BITO previously made headlines as the most successful organic launch in ETF history, setting a high benchmark for subsequent offerings.
Market analysts suggest that the initial success of the ‘Newborn Nine’ could indicate the long-term viability of Bitcoin ETFs. Despite the standard drop-off rate in trading volumes after a launch, the consistency seen in the first three days of trading points to a healthy demand for cryptocurrency-based investment options.
As the market closes on day three, all eyes are on BlackRock and whether its ETF can maintain the momentum to overtake GBTC in the race for Bitcoin supremacy. With ETFs becoming a crucial gateway for institutional and retail investors into the cryptocurrency world, the trajectory of these early days may well set the tone for the future of digital asset investing.
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