Bitcoin sits below all-time high after US ETF debut

Published October 20, 2021
A Bitcoin and Dollar notes are seen in this illustration picture. — Reuters/File
A Bitcoin and Dollar notes are seen in this illustration picture. — Reuters/File

Bitcoin hovered below record levels on Wednesday, the day after the first US bitcoin futures-based exchange-traded fund (ETF) began trading, a development that market participants say is likely to drive investment into the digital asset.

The world's leading cryptocurrency was last at $63,998, off 0.4 per cent, but still within a short jump of its record of $64,895.22, hit on April 14 this year.

It reached as high as $64,499 on Tuesday, late in the US day.

Earlier on Tuesday, the ProShares Bitcoin Strategy ETF closed up 2.59pc at $41.94 after its first day of trading, with around $1 billion worth of shares trading hands on Intercontinental Exchange Inc's Arca exchange.

Trading appeared to be dominated by smaller investors and high-frequency trading firms, analysts said, noting the absence of large block trades indicated that institutions were likely staying on the sidelines.

James Quinn, managing partner at Q9 Capital, a Hong Kong-based cryptocurrency private wealth manager, said the launch of the new product was “meaningful” for bitcoin.

“Theoretically, any licensed brokerage firm in the US who wants to take on this ETF can do so as easily as any other ETF, which should make it available to a lot of folks,” said Quinn.

While the ETF is based on bitcoin futures, Quinn said the trades and hedges underpinning the ETF means activity will flow into the spot market and the bitcoin price.

Crypto ETFs have launched this year in Canada and Europe amid surging interest in digital assets. VanEck and Valkyrie are among fund managers pursuing US-listed ETF products, although Invesco on Monday dropped its plans for a futures-based ETF.

Ether, the world's no. 2 cryptocurrency, was down 0.39pc on the day at $3,861, in sight of a six-week high, but a way away from its all-time high of $4,380, hit on May 12.

Opinion

A whiff of hope

A whiff of hope

Despite the old script that has played out in front of us, political events do indicate some changes.

Editorial

Updated 17 May, 2022

Buyer’s remorse

It is strange to hear senior PML-N leaders lamenting the subsidies, yet not even coming up with a subsidy rationalisation plan.
17 May, 2022

Sikh traders’ killing

THE brutal murder of two Sikh traders in the outskirts of Peshawar on Sunday illustrates the vulnerability of...
17 May, 2022

Cholera outbreak

REPORTS of rising cases of cholera and acute watery diarrhoea in several areas are raising the spectre of a public...
Updated 16 May, 2022

Electoral reforms

EARLY elections or not? That is the question. And it seems to be weighing heavy on the mind of everyone in the...
16 May, 2022

Iran deal revival

WHERE the nuclear deal between Iran and the P5+1 is concerned, a great deal of fluidity exists regarding its fate....
16 May, 2022

Deprived of funds

THIS May, Pakistan’s former Fata region will complete its fourth year of merger with Khyber Pakhtunkhwa. The...