BlackRock and ProShares Bitcoin ETFs Outpace GBTC in Daily Trading

On February 2, the price of Bitcoin (BTC) ranged from $42,580 to $43,422 as Grayscale’s GBTC lost its dominance over spot Bitcoin exchange-traded fund (ETF) selling. Ever since the launch of these ETFs on January 11, Grayscale’s converted GBTC ETF had been leading in terms of daily trading volumes. This changed on February 1 when BlackRock’s IBIT and ProShares’ BITO surpassed GBTC’s trading volume. According to Bloomberg Intelligence analyst James Seyffart, IBIT had $301 million in volume and BITO ended the day with $298 million, while GBTC came in third with $292 million. The total trading volume for the day was below $1 billion for the first time, reaching a cumulative volume of $28.30 billion. On February 2, GBTC regained its top spot with $240.68 million in trading volume.

GBTC’s dominance in the spot Bitcoin ETF market was a result of significant outflows from the trust since its inception. This was made possible by the ability of investors to redeem their investment once the product was converted into a spot ETF, something that was not possible before. Grayscale’s high fees caused it to lose over $5.8 billion worth of assets since January 11. In contrast, the nine new ETFs received inflows of $7.2 billion during the same period, according to BitMEX Research. GBTC’s dominance has started to decline in recent days. Previously, GBTC was sending an average of $700 million in BTC to Coinbase, but since January 26, this has decreased to less than $300 million. The outflows from GBTC in terms of BTC have also decreased, with 24,050 BTC leaving on January 26, and only 4,433 BTC on February 2. According to JPMorgan analysts, the outflows from GBTC were mostly due to profit-taking, which they believe is now over and could alleviate some pressure on BTC’s price. FTX crypto exchange sold its entire GBTC shareholding of 22 million GBTC shares, valued at around $1 billion.