The volume of trading in shares of the first American exchange-traded fund associated with bitcoins - Bitcoin Strategy ETF from ProShares on the day of the fund's launch - amounted to about $984 million. On it - by almost 4%. Bitcoin has risen in price above $ 64,000, almost reaching a record high in April
ProShares, the first U.S. exchange-traded fund, Bitcoin Strategy ETF, rose in value during its trading debut on the New York Stock Exchange. ETFs under the ticker BITO gained more than 4.5% to $ 41.89 per share. BITO's trading volume on the day the fund was launched was about $ 984 million, CNBC reports.
ETF (exchange traded fund) are investment funds that form portfolios of assets and issue their own shares, where each security is tied to a certain part of the fund's assets. ETFs allow you to purchase an asset without actually owning it. In the case of the Bitcoin Strategy ETF from ProShares, the fund is tied to bitcoin futures that have been traded on the Chicago Mercantile Exchange since 2017.
The launch of the first Bitcoin futures investment fund underlines the significant growth of the ETF industry, Will Hershey, CEO of Roundhill Investments, told CNBC. “The trading volumes are exceptional. BITO sold over 700 million notional dollars. This puts its first day well ahead of retail ETF favorites like BUZZ and ARKX compared to their respective launch days earlier this year, ”Hershey said.
He added that the SPDR S&P 500 ETF (the world's largest and most popular fund investing in equities based on the S & P500 index) debuted in 1993, traded at about $ 40 million on the first day. By the end of the trading session, BITO trading volume on the day of the fund's launch was about $984 million. The price of bitcoin rose above $ 64,000, according to CoinMarketCap, and only slightly lagged behind its all-time high on April 14 - $ 64,899. Bitcoin futures also rose by about 4%.
ProShares is the eighth largest asset-based ETF that tracks movement on a variety of stock indices. according to ETDB.com. The launch of similar funds by Valkyrie Investments, Invesco and VanEck is likely to be approved in October, The Wall Street Journal previously reported, citing analysts. They are to be followed by funds from Galaxy Digital, AdvisorShares, Bitwise, BlockFi and ARK Investment Management.
Beginning in 2017, asset managers of the company began filing applications for launching spot bitcoin ETFs with the Securities and Exchange Commission (SEC), but their offers were rejected. The flow of ETF applications based on bitcoin futures formed this year shortly after Gary Gensler became chairman of the SEC. He told CNBC that the SEC "has some ability to secure investor protection" in cryptocurrencies, based on the powers given by the 1940 Investment Company Act. "This is still a very speculative asset class, <...> underneath this is still the aspect of volatility and speculation," the head of the SEC warned investors.
Some experts believe that the impact of ETFs, especially those related to futures contracts, is diminishing as cryptographic services expand. Investors have many ways to gain indirect access to Bitcoin without actually owning it, through institutional-grade funds, financial apps like PayPal and CashApp Square, or stocks in cryptocurrency-related companies like Coinbase cryptocurrency exchange and mining centers.
“The launch of the first US Bitcoin ETF will strengthen the broader cryptocurrency market and help a whole new class of investors experience the benefits of Bitcoin as a legitimate asset,” said Anthony Bertolino, vice president of growth at iTrustCapital. He added that "Bitcoin derivatives ETFs are not what we want to be in the long run." According to Bertolino, bitcoin is "a bearer asset with a highly liquid spot market 24/7." “Investors will almost certainly want to have a bitcoin ETF with real support based on the spot, and in 10 years I would even expect some bitcoin ETFs to allow bitcoin buybacks for those who want it,” he summed up.