As more and more of the biggest investing organizations begin to provide the funds to their clients, crypto ETFs are becoming more and more popular.
The US Securities and Exchange Commission just approved bitcoin exchange-traded funds, and Bank of America’s Merrill and Wells Fargo are beginning to provide some of their wealth management clients access to them, according to people familiar with the subject who spoke with Bloomberg.
Bitcoin ETFs: Big Players Enter Crypto Arena
Several of the biggest asset managers in the US, including Fidelity and BlackRock, are among the issuers of Spot Bitcoin ETFs. But at first, wirehouses and conventional banks declined to provide the product to clients. Vanguard, Citi Bank, and UBS shunned the Bitcoin-backed investment vehicle at launch, previous reports disclose.
The fact that mainstream brokerage platforms have accepted bitcoin ETFs shows how big businesses are beginning to view cryptocurrencies as accessible, respectable investment options as opposed to purely speculative holdings.
Retail investors can gain exposure to the fluctuations in the price of bitcoin through exchange-traded funds (ETFs) instead of having to purchase the cryptocurrency directly from a less regulated exchange.
RIDIC: the New Nine doubled their volume record (set Monday) with just about $6b traded.. $IBIT led w $3.3b of it, Fidelity did $1.4b (both double their prev records). The total number of trades was double too, over half a million individual trades bt them. $IBIT alone > $QQQ. pic.twitter.com/ZzB5PWXA4f
— Eric Balchunas (@EricBalchunas) February 28, 2024
The price of bitcoin has recently increased; on Thursday, it briefly reached $64,000, barely below its all-time high of about $69,000 in 2021.
In an emailed statement on Thursday, Wells Fargo said spot bitcoin ETFs are available for “unsolicited purchases” through an advisor with Wells Fargo Advisors or “through our online WellsTrade platform.”
Total crypto market is currently valued at $2.23 trillion. Chart: TradingView.com
Because of rising Bitcoin prices, spot Bitcoin ETF providers have accumulated over $20 billion in assets under management (AUM). As the ETF wrapper accepts money from regular investors, hedge funds, and other capital controllers, the token has increased in value by about 50% so far this year.
Additionally, the investment vehicles experienced record-high trading volumes in the weeks following the approval of 11 spot bitcoin ETFs by US regulators in January. According to Bloomberg’s James Seyffart on X, trading activity for 10 ETFs surpassed $7.7 billion this week.
The new record for #Bitcoin ETF trading volume is officially $7.69 billion. Previous record was $4.66 billion from launch day. https://t.co/rZsOSUqk35 pic.twitter.com/QaOKe2LuVU
— James Seyffart (@JSeyff) February 28, 2024
Morgan Stanley Eyes BTC ETF
Meanwhile, Morgan Stanley, a prominent institution on Wall Street, is apparently considering allowing its clients to engage in spot BTC ETF trading. According to Bitwise’s chief investment officer, Matt Hougan, it is probable that additional trading giants will join the market, resulting in the influx of billions of dollars in untapped capital into Bitcoin through ETFs.
Gautam Chhugani, a Bernstein analyst, stated earlier this week that they remain persuaded that bitcoin is on “an 18-month road to $150,000” powered by unprecedented institutional adoption.
At the time of writing, Bitcoin was trading at $61,170, up 1.5% and 19.2% in the daily and weekly timeframes, data from Coingecko shows.
Featured image from Pexels, chart from TradingView