Breaking News
Get Actionable Insights with InvestingPro+: Start 7 Day FREE Trial Register here
Investing Pro 0
Ad-Free Version. Upgrade your Investing.com experience. Save up to 40% More details

U.S. futures-based bitcoin ETF rises in first day of trading, bitcoin nears record

Stock MarketsOct 20, 2021 09:12
Saved. See Saved Items.
This article has already been saved in your Saved Items
 
2/2 © Reuters. FILE PHOTO: A representation of the virtual cryptocurrency Bitcoin is seen in this picture illustration taken October 18, 2021. REUTERS/Edgar Su 2/2

By John McCrank

NEW YORK (Reuters) -The first U.S. bitcoin futures-based exchange-traded fund began trading on Tuesday, sending bitcoin to a six-month high and just off its all-time peak, as traders bet the ETF could boost investment flows into cryptocurrencies.

The ProShares Bitcoin Strategy ETF closed up 2.59% at $41.94 in its first day of trading, with around $1 billion worth of shares trading hands on Intercontinental Exchange Inc's NYSE Arca exchange under the ticker BITO.

The greenlighting of the ETF by the U.S. Securities and Exchange Commission was seen as a watershed moment for cryptocurrencies and helped push the price of bitcoin as high as $64,367.14, its highest level since mid-April and near its record of $64,895.22.

Bitcoin, the world's largest cryptocurrency, is notoriously volatile, and has risen around 45% this month on hopes that the advent of U.S. bitcoin ETFs - several of which are in the works - will spur billions of dollars managed by pension funds and other large investors to flow into the sector.

On Tuesday, there were very few block trades in BITO, suggesting that smaller investors and high-frequency trading firms dominated trading, said Dave Nadig, chief investment officer and director of research at ETF Trends.

"I think what we saw today was retail, HFT algo trading trying to find the arbitrage, and a whole lot of institutions sitting on the sidelines and watching," he said.

Similar products were set to come to market, with Nasdaq Inc having approved the listing of the Valkyrie Bitcoin Strategy ETF on Friday, while Grayscale, the world's largest digital currency manager, said it plans to convert its Grayscale Bitcoin Trust into a spot bitcoin ETF.

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

The SEC has yet to approve a spot bitcoin ETF.

Bitcoin futures have been overseen by the Commodity Futures Trading Commission for four years and ETFs are regulated by the SEC, offering some level of investor protection, the SEC's chair, Gary Gensler, said on Tuesday.

"Yet it's still a highly speculative asset class and investors should understand that underneath, there is the same volatility and speculation," he told CNBC.

Bitcoin futures were up 4.85% at $64,640.

U.S. futures-based bitcoin ETF rises in first day of trading, bitcoin nears record
 

Related Articles

Omicron Stalls TUI Recovery
Omicron Stalls TUI Recovery By Investing.com - Dec 08, 2021

By Catherine Reynolds  Investing.com --  TUI Group (LON:TUIT) shares were down 4.7% by mid-session in Europe as the emergence of the new Omicron variant stalled its vaccine-driven...

Add a Comment

Comment Guidelines

We encourage you to use comments to engage with users, share your perspective and ask questions of authors and each other. However, in order to maintain the high level of discourse we’ve all come to value and expect, please keep the following criteria in mind: 

  • Enrich the conversation
  • Stay focused and on track. Only post material that’s relevant to the topic being discussed.
  • Be respectful. Even negative opinions can be framed positively and diplomatically.
  •  Use standard writing style. Include punctuation and upper and lower cases.
  • NOTE: Spam and/or promotional messages and links within a comment will be removed
  • Avoid profanity, slander or personal attacks directed at an author or another user.
  • Don’t Monopolize the Conversation. We appreciate passion and conviction, but we also believe strongly in giving everyone a chance to air their thoughts. Therefore, in addition to civil interaction, we expect commenters to offer their opinions succinctly and thoughtfully, but not so repeatedly that others are annoyed or offended. If we receive complaints about individuals who take over a thread or forum, we reserve the right to ban them from the site, without recourse.
  • Only English comments will be allowed.

Perpetrators of spam or abuse will be deleted from the site and prohibited from future registration at Investing.com’s discretion.

Write your thoughts here
 
Are you sure you want to delete this chart?
 
Post
Post also to:
 
Replace the attached chart with a new chart ?
1000
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Thanks for your comment. Please note that all comments are pending until approved by our moderators. It may therefore take some time before it appears on our website.
 
Are you sure you want to delete this chart?
 
Post
 
Replace the attached chart with a new chart ?
1000
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Add Chart to Comment
Confirm Block

Are you sure you want to block %USER_NAME%?

By doing so, you and %USER_NAME% will not be able to see any of each other's Investing.com's posts.

%USER_NAME% was successfully added to your Block List

Since you’ve just unblocked this person, you must wait 48 hours before renewing the block.

Report this comment

I feel that this comment is:

Comment flagged

Thank You!

Your report has been sent to our moderators for review
Disclaimer: Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. All CFDs (stocks, indexes, futures) and Forex prices are not provided by exchanges but rather by market makers, and so prices may not be accurate and may differ from the actual market price, meaning prices are indicative and not appropriate for trading purposes. Therefore Fusion Media doesn`t bear any responsibility for any trading losses you might incur as a result of using this data.

Fusion Media or anyone involved with Fusion Media will not accept any liability for loss or damage as a result of reliance on the information including data, quotes, charts and buy/sell signals contained within this website. Please be fully informed regarding the risks and costs associated with trading the financial markets, it is one of the riskiest investment forms possible.
Continue with Google
or
Sign up with Email