Spot Bitcoin ETF: Trading Officially Resumes on National Exchanges

Spot Bitcoin ETFs have officially commenced trading on national exchanges less than 24 hours after receiving approval from the US Securities and Exchange Commission (SEC). This landmark decision marks a shift in the regulatory space, as the SEC greenlighted 11 investment vehicles, putting an end to 11 years of rejections for this digital asset product.

Swift Launch of Live Spot Bitcoin ETF Trading

The speed with which trading in spot Bitcoin ETFs has commenced after regulatory approval is nothing short of remarkable. Typically, the launch of new financial products involves a lag between regulatory approval and actual trading. However, the efficiency demonstrated in the case of spot Bitcoin ETFs underlines the growing acceptance and demand for digital assets in traditional financial markets.

This swift commencement has fueled optimism among investors and enthusiasts alike, as it represents a departure from the traditional hesitancy towards embracing innovative financial products.

Today is a historic day in financial markets.

The bitcoin spot ETFs begin trading this morning and billions of dollars will flow into the asset class.

This will impact price, fees, volatility, and much more.

Here is my conversation on @SquawkCNBC this morning. pic.twitter.com/3POCbE0Y0E

— Pomp 🌪 (@APompliano) January 11, 2024

Analysts and investors have highlighted the potential influx of billions of dollars into the Bitcoin market as a result of the new spot ETFs. This surge of corporate capital is expected to have a cascading effect on various facets of the crypto market.

The industry widely anticipates active market participation from some of the largest asset management firms globally, including Fidelity, Grayscale, and BlackRock, with Bloomberg predicting that the first trading day could bring in as much as $4 billion in spot Bitcoin ETF inflows. 

Notably, BlackRock’s iShares Bitcoin Trust (IBIT) has already seen $2 million in shares traded, and expectations are high for it to potentially break the one-day inflow record, generating up to $2 billion on its first trading day.

One key aspect to watch is the impact on transaction fees. As institutional and corporate investors pour funds into Bitcoin through ETFs, it is likely to affect transaction costs on major exchanges. Higher trading volumes can lead to increased liquidity, potentially resulting in lower fees for market participants.

Current Bitcoin Price Outlook

At the time of writing, Bitcoin is trading at $47,830, showcasing a robust 5.63% increase in the past 24 hours. This surge in price is indicative of the immediate market response to the introduction of spot Bitcoin ETFs. The momentum suggests that investors are reacting positively to the news, and the market sentiment is bullish.

The market cap of Bitcoin stands at an impressive $934.7 billion, underlining the cryptocurrency’s status as a trillion-dollar asset class. The surge in trading volumes, which has seen a 46.3% increase to $58 billion in the last 24 hours, further emphasizes the heightened interest and activity surrounding Bitcoin in the wake of the spot ETF launch.

In the long term, proponents believe this spot Bitcoin ETF will catalyze a bull run in BTC’s price which may cross $135,000 according to “Rich Dad Poor Dad” author Robert Kiyosaki.