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11.01.2024 10:10 PM
Bitcoin: Spot ETF Transaction Volume Exceeds $1 Billion in First Minutes of Trading

The eagerly awaited Bitcoin Spot ETFs began trading on U.S. stock exchanges on Thursday, with their transaction volume exceeding $1 billion. Against this backdrop, the price of Bitcoin surpassed $48,000.

According to recent data, the transaction volume in Bitcoin Spot ETFs surpassed $2.3 billion. Bloomberg ETF analyst Eric Balchunas remarked on the launch results, noting that within just 20 minutes of trading, the volume was significantly high, "with half a billion traded within the group (including GBTC), led by IBIT (close to passing $1 billion) and FBTC (far surpassing BITO)." He also noted that "almost all the volume in the first few days will turn into inflows."

Bloomberg analyst James Seyffart reported that in the first 30 minutes of opening, the transaction volume of the BTC ETF spot group exceeded $1.2 billion, of which GBTC reached 446 million, IBIT — 389 million, and FBTC — 230 million.

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How the Approval of Bitcoin Spot ETFs Will Affect the Market in the Long Term

Currently, the market is experiencing euphoria over the long-awaited approval. But economists are looking ahead, assessing the potential long-term impact on the price of BTC of this landmark event.

Some of them believe that this approval will be a serious demand shock in the market, occurring several months before the recurring supply shock of Bitcoin - the halving expected in April 2024. When a halving occurs, the rewards received by miners are cut by 50%.

Against this background, Bitcoin miners represent an attractive investment opportunity for investors looking for a way to access this long-term deal on the implementation of Bitcoin, thanks to its borrowed growth potential and theoretical risk hedging. Spot ETFs could bring "significant profit" and have a positive impact on the valuation of Bitcoin miners.

In this context, the approval of spot ETFs is a historic moment for Bitcoin and miners, as ETFs offer both retail and institutional investors a familiar and regulated investment tool, significantly expanding access to the main cryptocurrency.

Analyst Mike Colonnese believes that "many institutional and retail investors interested in BTC lack either the desire or the ability to invest directly in BTC, considering the nuances of requirements for acquiring digital assets." He also conveyed an expectation of a considerable rise in the demand for BTC, facilitated by these recently approved spot ETFs.

Capital to flood the cryptocurrency market

The next 24 months will be extremely interesting for the cryptocurrency industry, as evidenced by intense speculation from global investors. The approval of eleven Bitcoin Spot ETFs in the United States has opened the gates for billions of dollars to flow into the cryptocurrency market, thereby improving existing liquidity.

Moreover, any investor can now seamlessly use Bitcoin through traditional stock exchanges, with liquidity provided by traditional financial institutions and other authoritative market makers.

Well-known crypto influencer Michael van de Poppe noted that the approval of Spot Bitcoin ETFs in the U.S. significantly increased trust in the cryptocurrency market, leading to various models of macro price forecasts.

Against this backdrop, the price of Bitcoin could reach $600,000 during this bullish cycle. As a result, the analyst emphasized that investors should use a potential drop to the range of $36,000 to $40,000 in the short term to accumulate positions.

A similar bullish forecast was made by popular crypto analyst PlanB, using his S2F model. Notably, the crypto analyst expects that by the end of 2025, the price of Bitcoin will reach $532,000.

It's also worth noting that the altcoin market will also significantly benefit from the expected growth of Bitcoin in the coming quarters, as it will provide much-needed liquidity.

As a result, Bitcoin's dominance will continue to fall over the next two years, possibly dropping below 30 percent. Moreover, the emergence of first-tier blockchains that support smart contracts and web3 protocols is attracting more investors to the cryptocurrency industry.

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