On February 2, the price of Bitcoin fluctuated between $42,580 and $43,422, with a notable shift in the realm of spot Bitcoin exchange-traded fund (ETF) trading as the dominance of the Grayscale Bitcoin Trust (GBTC) temporarily eased.
BlackRock’s iShares Bitcoin Trust (IBIT) and ProShares’ Bitcoin Strategy ETF (BITO) surpassed GBTC’s daily trading volume, marking a significant shift in the market. GBTC had previously held sway over spot Bitcoin ETF trading volumes since their inception on January 11.
According to data shared by Bloomberg Intelligence analyst James Seyffart, IBIT led with a trading volume of $301 million, followed closely by BITO with $298 million, while GBTC trailed behind with $292 million in trades.
Still some after hours trading left but looks like BlackRock’s $IBIT is the first ETF to trade more than Grayscale’s $GBTC in a single day.
Total trading today was kind of a dud though at $924 million — first day below $1 billion in dollar volume for the group since launch. https://t.co/IeIF2COm4F pic.twitter.com/ZtADLBQP63
— James Seyffart (@JSeyff) February 1, 2024
Seyffart noted, “BlackRock’s IBIT is the first ETF to trade more than Grayscale’s GBTC in a single day,” adding that total trading volume for the group fell below $1 billion for the first time since launch, settling at $924 million on that day, bringing the cumulative trading volume to $28.30 billion.
However, by February 2, GBTC regained its top position with $240.68 million in trading volume.
GBTC’s dominance in spot Bitcoin ETFs was fueled by significant outflows from the trust since the onset of trading. Investors were able to redeem their investments once the product transitioned to a spot ETF, a feature previously unavailable.
Moreover, Grayscale’s high fees led to outflows exceeding $5.8 billion in assets since January 11, according to BitMEX Research. Over the same period, the nine new ETFs collectively saw inflows of $7.2 billion.
Bitcoin ETF Flow – Day 15
All data out. Net flow of +$38.5m for day 15. Relatively quiet day it seems pic.twitter.com/L478MuK9v1
— BitMEX Research (@BitMEXResearch) February 2, 2024
Despite its prior dominance, GBTC’s influence has waned in recent days. Previously, GBTC consistently transferred around $700 million worth of BTC to the Coinbase exchange, but this figure dropped to under $300 million since January 26.
In terms of Bitcoin, 24,050 BTC outflowed from GBTC, reducing to 4,461 BTC on Jan. 30 and 4,433 on Feb. 2.
JPMorgan analysts attributed GBTC outflows to profit-taking, suggesting that this trend might now be subsiding, which could alleviate pressure on BTC’s price.
Additionally, during a peak in GBTC selling, the FTX crypto exchange divested its entire GBTC shareholding of 22 million GBTC shares, valued at roughly $1 billion.