How Bitcoin ETFs have changed cryptocurrency investing in the year since their launch

In the first full year of trading, spot Bitcoin ETFs It may have radically changed the way investors view cryptocurrency investments.

Spot Bitcoin ETFs Trading has begun on January 11, 2024, which will open the cryptocurrency market to a wider range of investors and pave the way for more such products. The launch also played a role in boosting the price of Bitcoin (Bitcoin against the dollar) to a series of record highs, as investors poured billions into ETFs.

Here’s what’s happened since the launch of spot bitcoin ETFs.

ETFs have made investing in Bitcoin more accessible

Spot Bitcoin ETFs have made it easier for investors to gain exposure to the cryptocurrency.

Typically, if you want to buy Bitcoin, you will need cryptocurrency wallet And you need to buy the token from a cryptocurrency exchange. Alternatively, if you choose a Bitcoin ETF, you can Buy the product Using your brokerage account as you would any other ETF.

Investors have appreciated this ease and have poured billions into spot Bitcoin ETFs. Individual and institutional investors alike share this enthusiasm, even with traditional Wall Street firms and hedge funds Getting into work.

Bitcoin is often referred to as digital gold, and Bitcoin ETFs are rapidly gaining popularity compared to gold ETFs.

Blackrock’s iShares Bitcoin Trust (Ebit) is one of the most popular ETFs, with net inflows to date exceeding $37 billion. The fund has witnessed tremendous growth, with assets exceeding $52 billion as of January 9. Significantly superior The $33 billion assets of the 20-year-old iShares gold ETF (International Astronomical Union), closing SPDR Gold shares (GLD) – The largest gold ETF with assets of more than $75 billion.

Bitcoin ETFs, the halving, and Trump’s win sent prices soaring

Spot Bitcoin ETFs hold the cryptocurrency as an underlying asset. So, as more people put money into the ETF, the ETF has to buy more Bitcoin. This demand helped push Bitcoin prices to record levels last year.

Bitcoin was trading near $46,000 on January 10, when it traded Securities and Exchange Commission She gave her consent To start trading Bitcoin ETFs. Its price fell below $40,000 in the first few weeks after the ETFs began trading, but then rebounded to hit a new high of more than $73,000 in March before trading began. Bitcoin halving.

Bitcoin halvings, an event that occurs approximately every four years, slow the pace of new bitcoin creation. Dwindling supply and increasing demand of ETFs created an imbalance, sending prices higher.

Donald Trump’s victory in the presidential election in November provided an additional jolt, amid investors’ hopes that a crypto-friendly White House and Congress would adopt policies that support the asset class. Bitcoin hit Multiple all-time highs In the weeks following the election, it rose to $108,000 in mid-December. The price of the digital currency reached $95,000 on Friday afternoon.

Bitcoin ETFs have paved the way for more products

The success of spot Bitcoin ETFs has also led to the approval of other regulated and cryptocurrency-focused financial products such as Spot Ether ETFs (ETH/USD) and Trade options on Bitcoin ETFs.

The Trump administration, which is scheduled to take office on January 20, is… expected To ease regulatory restrictions on cryptocurrencies, which could lead to the approval of more crypto ETFs.

There are already proposals for XRP (XRPUSD) and Solana (SolUSD) ETFs that have been filed with the Securities and Exchange Commission. Additionally, Bloomberg ETF analysts see potential for Litecoin (LTCUSD) and Hadera (Hapar USD) ETFs will be approved in 2025, following the approval of the Bitcoin and Ether ETF.