Bitcoin Drops 15% Post ETF Approval: A First Mover Americas Insight

• Bitcoin ETFs Impact and Future Predictions
• Ethereum's Potential Upsurge in 2024
• ARK Invest's ETF Trading Actions
• Chart of The Day

Bitcoin ETFs Impact and Future Predictions

Bitcoin$42,260 -0.64% (BTC) experienced a significant decline of over 15% to approximately $41,300 following the listing of the first U.S. spot BTC ETFs last week. This decline corresponds with $1.5 billion exiting the Grayscale Bitcoin Trust (GBTC), according to JPMorgan. GBTC investors, who had been purchasing the GBTC fund at a considerable discount to its net asset value (NAV) over the past year in preparation for its anticipated ETF conversion, seem to be exiting the Bitcoin market entirely after securing profits post-ETF conversion. Rather than switching to less expensive spot Bitcoin ETFs, these investors seem to be leaving the space altogether. If JPMorgan's previous estimate of up to $3 billion invested in GBTC in the secondary market during 2023 is accurate, we could see an additional $1.5 billion exiting the market through profit-taking on GBTC, which could continue to pressure Bitcoin prices in the upcoming weeks.

Ethereum's Potential Upsurge in 2024

Ethereum$2,315 -2.42% (ETH) is being tipped to surge in 2024, with the potential listing of a spot ETH ETF serving as a significant catalyst, according to analysts at Coinbase. ETH achieved its highest value since May 2022 after the approval of Bitcoin ETFs in the U.S. last week. Companies such as BlackRock and VanEck, who were behind the BTC ETFs, are reportedly planning similar products for ETH, as stated in a recent Coinbase newsletter. In addition to ETF speculation, Ethereum's impending Dencun upgrade, which aims to enhance the mainnet's scalability, may fuel investor interest in ETH. ETC Group, a prominent institutional crypto firm, indicated in its annual report a bullish outlook for Ether, given Ethereum's continued dominance in the DeFi landscape and the additional returns users can generate via staking.

ARK Invest's ETF Trading Actions

ARK Invest offloaded an additional $15 million worth of shares in the ProShares Bitcoin Strategy ETF (BITO) on Wednesday, following the selling of $15.8 million worth the previous day. Essentially, ARK swapped the BITO shares for $15 million of its own spot Bitcoin ETF (ARKB). ProShare's Bitcoin product, the first ETF tied to the BTC futures market listed in the U.S., debuted in October 2021. ARK had disposed of its Grayscale Bitcoin Trust shares in the latter part of last year, favoring BITO in anticipation of the approval of spot Bitcoin ETFs in the U.S. Now that the approval has been granted, ARK is shifting toward its own product.

Chart of The Day

This chart illustrates the monthly net position change, or the 30-day change in supply held by long-term Bitcoin holders. According to Glassnode, long-term holders are defined as wallets that have retained coins for 155 days or more. This indicator turned negative earlier this month, signaling net selling by long-term holders. It dropped to -33,951 BTC on Wednesday, marking the lowest point since December 2022.

Edited by Jonathan Stoker