Vigorous Interest Left Behind by Tediousness of Bitcoin ETF

  • Interest in future Bitcoin ETFs is getting lowered and might have many causes, and the prime cause remains the bearish price of Bitcoin.
  • 4904 CMEs are held by the future ETFs of Bitcoin, as per the fresh update of the fund on 11th January.
  • Bitcoin was up by 2.32% in 24 hours and was trending at the price of $43,780.73.

Folks Losing Interest in Future Bitcoin ETF

According to a fresh weekly report, ProShares’ BITO, Bitcoin’s ETF based on future, is currently holding 4904 future contracts of Chicago Mercantile Exchange(CME). This count was the very first instance since November when it was below 5000.

An ETF or an exchange-traded fund is a kind of investment item that enables the coin holder to bet on the product’s market value without actually holding the asset.

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Approval to the ETFs based on the future was given back in October 2021, where they were officially released and went live. The $1 Billion mark was achieved by ProShares’ BITO in AUM after a couple of days of the launch, and this is the quickest for any ETF to reach the $1 Billion mark.

People might think that why in the world anyone would utilize such kind of fund when they can directly purchase Bitcoin, well there might be few causes.

ALSO READ – REINFORCEMENTS ON THE WAY FOR BITCOIN DEVS AS JACK DORSEY SETS UP DEFENSE FUND

One cause can be that some of the investors are not well-versed with the mechanism of the crypto sector, so they may be unwilling to steer around the wallets and exchanges. At the same time, the Exchange Traded Funds is a known territory for many conventional investors. 

Another cause might be that the ETFs based on the future offers the ability to hypothesize on the value of Bitcoin in both directions. Only when the price is escalating, are holders able to make profits straightforwardly in the spot trading.

People can witness the interest regarding ProShares’ BITO since it initiated trading.

Source: https://www.research.arcane.no/blog/2022-1

As it is apparent in the graph mentioned above that the ETF of Bitcoin now holds under 5000 CMEs. This is the very first time since November when the count is under 5000. 

This also indicates the fading interest in the future-based ETFs of Bitcoin. This might be because of the fall in the value of Bitcoin over the past few months. 

Another cause might be the fact that the running costs of ETF instruments based on the future are expensive. But the same is not the case with spot-based ETFs. Meanwhile, none of such funds has received approval for Bitcoin. 

Below is the price chart for Bitcoin, where you can see the price fluctuations in Bitcoin over the past week.

Source: https://coinmarketcap.com/currencies/bitcoin

As the article was being written, the crypto asset was bullish by 2.32% and is dominating the market with a market capitalization of $828.6 Billion. Bitcoin is being controlled by the bears over the past few months, but it is slowly gaining traction to maintain the price levels above $40k.

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Krystian Bielanskihttp://www.thecoinrepublic.com
Krystian is a crypto trader and investor with a background in IT based in Hong Kong. He specialises in technical and fundamental analysis working closely with chartist and algo programmers.

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