Spot ETFs Fail To Ignite Bitcoin Growth – Analyst
03 Noviembre 2024 - 8:00AM
NEWSBTC
The Spot Bitcoin ETFs have become a major headliner recently due to
heightened levels of market inflows. According to data from
SoSoValue, these ETFs have attracted over $5 billion in investments
over the past three weeks coinciding with an impressive Bitcoin
price rally of over 23%. However, amidst this euphoria, macro
investment researcher Jim Bianco says these Spot ETFs have
contributed no significant growth to the Bitcoin market.
Related Reading: BlackRock’s Bitcoin ETF Reaches 2% Of Total BTC
Supply Amid Record Inflows Spot Bitcoin ETFs Bring In No New Money,
Only Recycled Investments In a series of X posts on November 2,
Bianco claimed the Spot Bitcoin ETFs despite their impressive
inflow record do not attract any new investments to the underlying
asset. Firstly, The analyst applauds the performance of these
institutional funds some of which rank as the best-performing ETFs
of 2024 following their launch in January. However, Bianco
highlights BTC has failed to surpass its all-time high value of
73,750 set eight months ago despite the Spot Bitcoin ETFs accruing
over $12 billion in inflows since BTC within the same period.
Rather than being less than 4% down from its ATH, the analyst
explained that such high inflows should have since pushed premier
cryptocurrency beyond the $100,000 mark especially considering
other positive indicators such as Fed rate cuts, the halving, and
public endorsement by Republican Presidential candidate Donald
Trump. For context, Bianco references the Gold ETFs with a
record of over $6 billion in inflows since March 13, resulting in a
25% increase in gold’s market price during that period. The market
analyst postulates that this price growth can be attributed to the
“new money” flowing into the Gold ETFs. However, recycled funds
shifted from on-chain wallets or centralized exchanges account for
the majority of the investments in Spot Bitcoin ETFs. Jim
Bianco backs this theory with a report from Coinbase CFO Alesia
Haas which highlighted a decline in the exchange’s bitcoin retail
traders over the last few months. Furthermore, he also points to
the average Spot BTC ETF trade of $16,000 compared to the average
gold ETF trade of $72,000 which is consistent with
investments from wealth managers and institutions. In conclusion,
Jim Bianco states the Spot Bitcoin ETFs are not attracting any “new
money” but merely circulating existing investments in Bitcoin,
which he describes as a concerning trend that may grant traditional
financial institutions (TradFi) more influence in the crypto market
as against the ethos of decentralization. Related Reading:
Dogecoin Price Could Climb To $0.209 — Here’s The Level To Watch
Bloomberg Analyst Fires Back At BTC ETF Criticism Popular Bloomberg
ETF analyst Eric Balchunas has issued a strong rebuttal to Bianco’s
take on the Spot Bitcoin ETFs which he describes as merely “mental
gymnastics”. Balchunas has lauded the performances of these ETFs
which he believed have played a crucial role in driving Bitcoin’s
price from $35,000 in January to the present market price of almost
$70,000. The Bloomberg analyst describes the Spot Bitcoin ETFs
as “powerful” due to their low cost, high liquidity, and
association with an established brand name and advises against
betting against them. At the time of writing, BTC. continues to
trade at $68,100 reflecting a 2.55% decline in the past 24 hours.
Featured image from Blockzeit, chart from Tradingview
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