Bitcoin ETF demand hits 6-month high while futures volumes remain ‘subdued’

by

As a seasoned analyst with years of experience in the cryptocurrency market, I find myself intrigued by the current dynamics between spot Bitcoin ETFs and futures trading volumes. The surge in demand for spot Bitcoin ETFs among retail investors is indeed noteworthy, reaching levels not seen since April’s Bitcoin halving. However, it’s the contrast with the waning interest among futures traders that catches my attention.

The interest in trading exchange-traded funds (ETFs) tied to Bitcoin (BTC) has risen to its peak level since the Bitcoin halving in April. Conversely, the enthusiasm among futures traders appears to be decreasing as per the latest information.

According to a report from Glassnode, the daily trading volume for all cryptocurrency futures contracts ($35 billion) appears relatively low compared to the higher volumes observed during the market’s peak in March.

A ‘significant impulse’ among futures traders is missing

The number of bitcoin futures contracts being traded each day has dropped to around half of its previous level, which was seen shortly after Bitcoin hit its record high of $73,679 in March and surpassed the $80 billion mark for daily trading volume.

Previously, the volume leveled around $80 billion only once, specifically in early August, coinciding with a 22% decline in Bitcoin’s price over an 8-day span. This drop culminated on August 6th, with Bitcoin reaching a value of $53,991.

According to Glassnode, there hasn’t been a substantial increase in trading activity as of now. This could mean that individual trades and arbitrage positions are playing a more significant role in the futures markets.

Spot Bitcoin ETF soars, fueled by retail investors

In a post dated October 25th on X, Ki Young Ju, the founder and CEO of CryptoQuant, pointed out the 30-day trend of the Spot Bitcoin ETF. He mentioned that the interest in this ETF has recently peaked to its highest level in six months.

Ju pointed out that netflows totaled 65,962 BTC over the last 30 days.

After the introduction of Bitcoin Spot ETFs in January, a total of approximately $21.6 billion has been poured into these funds as of the latest data from Farside.

On October 25th, Binance published a study indicating that individual investors, rather than institutions, are primarily driving the demand for Bitcoin Spot Exchange-Traded Funds (ETFs).

According to a recent report on Bitcoin Exchange Traded Funds (ETFs), it was revealed by Binance analysts that, as of October 10th, approximately 80% of the total assets managed in these funds were held by individual investors who are not part of institutions.

Read More

2024-10-25 22:42