The approval of cryptocurrency index funds in the United States was celebrated as a groundbreaking event for digital investments. Now things are clear: the launch was lukewarm, and traditional forces are leading the race.
The launch of the much anticipated exchange-traded funds (ETFs) for the oldest cryptocurrency, bitcoin, has remained below expectations in the first two days of trading.
Bitcoin Price Speaks Volumes
According to calculations by crypto asset manager CoinShares, the eleven products approved by the SEC in the last week have since raised just under $1 billion. A report in British newspaper «Financial Times» (paid article) states that experts believe that this was by no means a mass success.
The price of the bitcoin itself is also an indicator of this. In the run-up to the SEC approval, the price had increased sharply because investors expected much more demand from the new fund products. Once the funds got the green light, the bitcoin price briefly took a hit and has stagnated since then.
Outflows for Pioneer
It is now also clear that the launch of the new products played into the hands of the established Wall Street giants above all. The world’s largest asset manager, BlackRock, has so far gained $508 million in assets; with U.S. competitor Fidelity trailing behind with $442 million. On the other hand, Grayscale, the biggest fund for crypto investments up until now, had to expect outflows of $579 million from its bitcoin ETF.
This is because existing investors were previously only able to sell their shares outside of the exchange, and can now profit from the improved liquidity.
