- Bitcoin Spot ETF trading volume, dominated by Grayscale’s GBTC, totaled more than $4.6 billion on Thursday.
- Bitcoin ETFs registered 700,000 individual trades, doubling those in the Nasdaq 100’s tracking fund QQQ.
- BTC price hit a peak of $48,900 for the first time since December 2021, but corrected to $46,000 on Friday.
Bitcoin (BTC) price falls to around $46,000 during Friday’s Asian session, correcting from the two-year high of $48,900 seen on Thursday. Bitcoin’s rally was likely caused by rising market interest following the US Securities and Exchange Commission’s (SEC) approval of spot exchange-traded funds (ETF) that track Bitcoin’s price.
During the first trading day of the ETFs on Thursday, around 700,000 individual trades were registered and trading volume exceeded $4.6 billion.
Daily digest market movers: Bitcoin ETF trades explode, Grayscale gets major share
- Bitcoin ETFs completed over $4.6 billion in trade volume on their first day.
- Grayscale captured nearly half this trade volume. However, Bloomberg ETF analyst James Seyffart attributes this to entities selling their GBTC shares for other ETFs, in lieu of fees and other factors.
- ETF issuers are competing in the so-called by analysts “Cointucky Derby”, slashing their fees to attract more traders and capture a larger market share. Bitwise Invest currently offers the lowest fee at 0.2%.
- The trading volume in Bitcoin Spot ETFs lagged when compared to the QQQ – the ETF that tracks the Nasdaq 100 – However, it recorded around 700,000 trades, nearly double the number of the QQQ, Bloomberg’s Senior ETF analyst Eric Balchunas said.
All told there were 700,000 individual trades today in and out of the 11 spot ETFs. For context, that is double the number of trades for $QQQ (altho it sees much bigger $ volume bc bigger fish use it) So a lot more grassroots action (vs big seed buys) than I expected which is… pic.twitter.com/syUGfjHQpr
— Eric Balchunas (@EricBalchunas) January 11, 2024
- Greekslive ambassador behind the X handle @4adybug said the Bitcoin ETF inflow was at a reasonable level for day one, with neither too much nor too little and in line with what was expected. The ETF approval makes the US time zone more important than the futures market, according to the crypto expert, and Bitcoin price is likely to remain rangebound between $48,000 and $53,000.
Technical Analysis: Bitcoin price hits two-year peak as $45,000 remains key
Bitcoin price hit a two year peak on Thursday as it crossed the $48,900 level for the first time since December 2021. This makes the $45,000 support an important area for BTC. Greekslive ambassador @4adybug said that in the event that Bitcoin slips below this level without a quick recovery, it can be considered a signal of reversal in the current uptrend.
If Bitcoin price sustains above $45,000 and moves sideways, it opens up opportunities for altcoin trades, he said.
To the upside, Bitcoin gains are likely capped at the 61.8% Fibonacci retracement level of the asset’s decline between November 2021 and 2022, which is set at $49,400. BTC price could, therefore, rally towards this target before seeing a pullback.
BTC/USDT 1-day chart
Open Interest, funding rate FAQs
How does Open Interest affect cryptocurrency prices?
Higher Open Interest is associated with higher liquidity and new capital inflow to the market. This is considered the equivalent of increase in efficiency and the ongoing trend continues. When Open Interest decreases, it is considered a sign of liquidation in the market, investors are leaving and the overall demand for an asset is on a decline, fueling a bearish sentiment among investors.
How does Funding rate affect cryptocurrency prices?
Funding fees bridge the difference between spot prices and prices of futures contracts of an asset by increasing liquidation risks faced by traders. A consistently high and positive funding rate implies there is a bullish sentiment among market participants and there is an expectation of a price hike. A consistently negative funding rate for an asset implies a bearish sentiment, indicating that traders expect the cryptocurrency’s price to fall and a bearish trend reversal is likely to occur.
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.
If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.
FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.
The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.
Recommended Content
Editors’ Picks
Bitcoin Weekly Forecast: BTC nosedives below $95,000 as spot ETFs record highest daily outflow since launch
Bitcoin price continues to edge down, trading below $95,000 on Friday after declining more than 9% this week. Bitcoin US spot ETFs recorded the highest single-day outflow on Thursday since their launch in January.
Bitcoin crashes to $96,000, altcoins bleed: Top trades for sidelined buyers
Bitcoin (BTC) slipped under the $100,000 milestone and touched the $96,000 level briefly on Friday, a sharp decline that has also hit hard prices of other altcoins and particularly meme coins.
Solana Price Forecast: SOL’s technical outlook and on-chain metrics hint at a double-digit correction
Solana (SOL) price trades in red below $194 on Friday after declining more than 13% this week. The recent downturn has led to $38 million in total liquidations, with over $33 million coming from long positions.
SEC approves Hashdex and Franklin Templeton's combined Bitcoin and Ethereum crypto index ETFs
The SEC approved Hashdex's proposal for a crypto index ETF. The ETF currently features Bitcoin and Ethereum, with possible additions in the future. The agency also approved Franklin Templeton's amendment to its Cboe BZX for a crypto index ETF.
Bitcoin: 2025 outlook brightens on expectations of US pro-crypto policy
Bitcoin price has surged more than 140% in 2024, reaching the $100K milestone in early December. The rally was driven by the launch of Bitcoin Spot ETFs in January and the reduced supply following the fourth halving event in April.
Best Forex Brokers with Low Spreads
VERIFIED Low spreads are crucial for reducing trading costs. Explore top Forex brokers offering competitive spreads and high leverage. Compare options for EUR/USD, GBP/USD, USD/JPY, and Gold.