US bitcoin ETFs start trading a day after SEC nod
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The news: A number of exchange-traded funds (ETFs) tied to the spot price of bitcoin have begun trading in the US in a test for the broader acceptance of digital assets as an investment.
The numbers: Eleven spot bitcoin ETFs, including BlackRock's iShares Bitcoin Trust, Grayscale Bitcoin Trust, Valkyrie Bitcoin Fund and ARK 21Shares Bitcoin ETF, among others, began trading overnight, kicking off a fierce competition for market share. The ETF launches lifted the price of bitcoin to its highest level since December 2021. It was trading 0.16% higher at US $46,021 ($69,455).
The context: Trading began after the US Securities and Exchange Commission finally gave the green light late on Wednesday, following a decade-long tussle with the crypto industry. The SEC had previously rejected all spot bitcoin ETFs on investor protection concerns.
The approval is expected to start an intense competition for market share among the issuers, with some analysts estimating inflows to cross USD10 billion in 2024. Others cautioned that the euphoria around the approval might be premature, with the broader investment community still viewing cryptocurrencies as risky.
What they said: "The approval has the potential to simplify and secure bitcoin investments for a broader investor base, which may reshape the dynamics of cryptocurrency investments," Rajeev Bamra, senior vice-president of digital finance at Moody's Investors Service told Reuters.
The source: Reuters
