Key Takeaways
- Bitcoin futures ETF traded almost $1 billion after launch.
- Bitcoin Futures ETF to allow traders to wager on bitcoins future prices without owning the coin.
- BITO appreciated by 4.85% after it was launched.
The primus Bitcoin futures ETF has left traders astounded after its debut in the U.S. Couple of hours ago. Seeing enthusiastic traders transacting over $280 million in shares within the first 20 minutes of its debut.
By the close of trading hours on Tuesday, almost $1billion in shares had been transacted.
So far, in the history of trading volume, only the BlackRock U.S. Carbon Transition Readiness ETF had locked on the $1 billion trading volume mark after hitting $1.16 billion when it launched in April. Bitcoin futures ETF came second with a volume of $994 million.
After getting permission from the US SEC on Friday, ProShares' Bitcoin Strategy ETF commenced trading a couple of hours ago on the New York Stock Exchange under the handle BITO. Traders who wanted to taste the waters of the most renowned cryptocurrencies got a shot to purchase shares associated with the future price of bitcoin, which appreciated to $42.15% - about 5.4% from its originally launched price of $40. The share eventually closed at $41.94, at an appreciation of 4.85%.
Reacting to BITO's performance on the day it launched, ETF research analyst with Bloomberg stated that he anticipated the launch to be a success if it could hit $250 million trade volume on its launch and it broke that mark in 20 minutes.
The ETF futures allow institutional and individual traders to transact in Bitcoin without hodl the coin directly, which might prove a bit complex for some traders. There is, however, a little snag. This ETF is a futures ETF, which entails that traders are transacting in shares that represent contracts wagering on the price of Bitcoin. Although a spot trading method is still favoured, a bevvy of renowned major corporations has been looking for endorsement of bitcoin ETF with direct connection to the coin price.
It is no secret that the U.S. regulatory body, SEC, has been quite reluctant to endorse a Bitcoin ETF future. The reason is not far from the belief that the digital asset space is largely manipulated. However, chairman Gary Gensler stated sometime in August that the regulation of the futures market by CFTC could pave the way for SEC's endorsement of ETF future on Bitcoin.
Although, Bitcoin ETFs that allow traders to enjoy the benefits provided by the cryptocurrency spot markets do not exist in the U.S. The trading model has been largely successful in Canada.
Whether you are hodling or wagering, bitcoin ETF's future strategy has cemented the proposition that the Whales of Street are craving Bitcoin.
Do you agree that CFTC regulations on Future trades are enough confirmation for SEC to endorse ETF futures on Bitcoin?
