A full week has passed since the U.S. Securities and Exchange Commission (SEC) granted approval for Spot Bitcoin exchange-traded funds (ETFs), and unsurprisingly, this development triggered a “sell-the-news” reaction among many cryptocurrency traders, as revealed by South Korean data firm CryptoQuant.
Numerous cryptocurrency traders seized this occasion as the perfect moment to sell their holdings. Notably, Spot Bitcoin ETFs began trading with record-breaking volumes for an ETF launch. Furthermore, Coinbase exchange witnessed unprecedented volumes in over-the-counter (OTC) desk transfers. Most Bitcoin ETFs are currently trading at a premium compared to the spot Bitcoin price, as reported by CryptoQuant.
CryptoQuant clarifies that the approval of Bitcoin ETFs was anticipated to generate a “sell-the-news” scenario, leading to a price decline of up to 15% since January 11, where Bitcoin’s value dropped from $48,700 to as low as $41,500.
As of the current moment, Bitcoin finds support within the $41,000 to $43,000 range. Nevertheless, the possibility of a downtrend cannot be dismissed entirely. Nonetheless, the leading cryptocurrency continues to maintain a positive trajectory, buoyed by various factors.
However, CryptoQuant points out that various on-chain metrics and indicators still suggest that the price correction may not have concluded or, at the very least, that a new rally may not be imminent. Short-term traders and large Bitcoin holders continue to engage in significant selling activities within a context of a “risk-off” sentiment.
US Spot Bitcoin ETFs See Massive Inflows
The Spot Bitcoin ETFs have garnered substantial inflows, amassing a combined trading volume of nearly $10 billion in a mere three days, as reported by Ruholamin Haqshanas from Cryptonews.
Bloomberg analyst James Seyffart highlights Grayscale’s GBTC as the standout performer among the spot Bitcoin ETFs, boasting an impressive three-day trading volume of $5.174 billion. BlackRock’s IBIT also witnessed significant participation, reaching a trading volume of $1.997 billion, while FBTC recorded $1.479 billion in the same timeframe. Collectively, these three ETFs contributed to an impressive $9.771 billion in trading volume, underscoring robust investor enthusiasm within the cryptocurrency market.
ETFs are the Talk of the Town in Davos
Once more, the world’s social elite have convened in Davos for the World Economic Forum (WEF), a prestigious global gathering that assembles the most influential figures in politics and business to deliberate on forthcoming business trends. This year, attendees from the cryptocurrency sphere are radiating optimism, and this positivity largely stems from the SEC’s endorsement of ETFs.
“The recent approval of ETFs signifies the dawn of a new era, signifying the acknowledgment of the potential inherent in cryptocurrency and blockchain technology. It solidifies their status as digital assets that can now receive broader investments and support from a wide array of investors,” remarked Sebastien Borget, COO, and co-founder of The Sandbox, speaking from Davos.
