According to a report from Bloomberg, the adoption of spot Bitcoin exchange-traded funds (ETFs) is currently facing a slowdown. This is mainly due to the extensive due diligence processes being conducted by major trading platforms. The hype surrounding Bitcoin ETFs has encountered challenges in gaining momentum due to these rigorous evaluation procedures undertaken by large trading platforms.
Industry players are taking a cautious approach, possibly to ensure regulatory compliance and mitigate risks associated with this innovative financial instrument. This delay in adoption is significant and highlights the complexities and meticulous scrutiny involved in introducing new financial products related to cryptocurrencies.
The report states that organizations like LPL Financial Holdings, one of the largest independent broker-dealers in the United States, are thoroughly reviewing newly approved Bitcoin ETFs before making them available to consumers. LPL Financial, with $1.4 trillion in assets under management, expects to complete its due diligence on Bitcoin ETFs within three months. The company is considering various options, including the possibility of ETF closures if it fails to attract substantial assets.
Due diligence is a comprehensive analysis conducted before making an investment decision. It involves carefully verifying data and understanding the risks and opportunities involved.
According to Bloomberg, 253 ETFs closed down in 2023, with an average asset value of $34 million. This includes crypto-related products such as the VanEck Digital Assets Mining ETF (DAM) and Volt Crypto Industry Revolution.
As of January 31, all Bitcoin ETFs approved last month held 656,421 BTC, worth approximately $27 billion at current rates. However, the performance of these ETFs has been affected by outflows from the Grayscale Bitcoin Trust, which sold 132,195 Bitcoin after transitioning from an over-the-counter product to a public ETF.
In terms of the crypto market performance, as of now, Bitcoin is valued at $43,103.46, down 0.1% from an hour ago and up 0.1% from yesterday. The value of BTC today is 1.9% higher than it was seven days ago. In the last 24 hours, the total amount of Bitcoin transactions was $14,208,105,808.
The global crypto market cap currently stands at $1.73 trillion, up 0.71% in the last 24 hours and 56.7% from a year ago. As of today, BTC has a market cap of $845 billion, accounting for 48.72% of the overall crypto market cap. Meanwhile, stablecoins have a market cap of $137 billion, representing 7.91% of the total crypto market cap.
According to CoinMarketCap, the current price of Bitcoin ETF is $0.000894 USD, with a 24-hour trading volume of $8,644.51 USD. Bitcoin ETF has dropped by 6.49% in the last 24 hours. It currently holds the rank of #4687 on CoinMarketCap. The circulating supply is unavailable, with a maximum quantity of 1,000,000,000 ETF coins.
Anthony Scaramucci has strongly criticized The Economist’s recent article for portraying the nascent Bitcoin ETF industry in a negative light. The article raised questions about the effectiveness of Bitcoin ETFs following their long-awaited approval by the Securities and Exchange Commission (SEC), sparking a debate among crypto enthusiasts.
Scaramucci, known for his optimistic stance on cryptocurrencies, questioned the pessimistic outlook, asking what would be considered a success if a $5 billion ETF debut is deemed unsatisfactory.
The analysis contrasts the potential of BTC ETFs with the historical performance of gold ETFs, demonstrating significant market dynamics and variations in investor behavior. It suggests that Bitcoin ETFs may not have the same revolutionary impact as gold ETFs.
