- The latest Bitcoin ETF in the US was a hit on day one.
- The launch comes as BlackRock and Fidelity push further into crypto to lure clients.
A Bitcoin exchange-traded fund saw a flurry of trading in one of the most successful first days all year, lifting sentiment days after BlackRock filed to launch a similar product and amid a report that fund giant Fidelity has eyes on the space.
An ETF from Volatility Shares, a smaller issuer, called the Volatility Shares 2x Bitcoin Strategy, went live in the US on Tuesday. Around $5.5 million was traded on day one, among the best first days of an ETF this year, said Bloomberg Intelligence’s ETF expert Eric Balchunas.
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The fund aims to offer twice the daily performance of the S&P CME Bitcoin Futures Daily Roll Index. While a number of Bitcoin futures products exist in the US, this is the first leveraged product to gain approval from the Securities and Exchange Commission.
The fund’s launch comes as some of the world’s largest asset managers are posturing to have a spot Bitcoin ETF approved for the first time in the US.
‘It’s just a matter of when’
On Tuesday, The Block reported that the asset manager’s filing was imminent. The application would be Fidelity’s second try for such a product — the $4.5 trillion asset manager filed for a spot Bitcoin ETF in 2021. It was denied at the beginning of 2022.
“They’re definitely going to file, it’s just a matter of when, probably,” Balchunas told DL News.
BlackRock, the $9 trillion asset manager, applied for a spot Bitcoin ETF earlier this month — an application that appears to have kicked others into gear. The fact that over 30 previous applications have been unsuccessful over a 10-year period has not deterred the recent applicants.
Following the surprise application from Larry Fink’s firm, WisdomTree and Valkyrie filed similar applications.
Driving traditional finance giants is a generational shift in their clientele. BlackRock plans to offer low-cost savings plans that use ETFs to lure more retail investors in Europe, the Financial Times reported earlier this year.
Meanwhile, Fidelity is actively courting younger customers on social media. The firm spent $410 million on Reddit in 2021 and it’s active on TikTok.
Fidelity made headlines last year when it offered customers the opportunity to invest in some cryptocurrencies through their 401ks.
Fidelity insiders told DL News in March that the company might exceed its hiring targets for its digital asset unit, pushing its headcount above 500.
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At a conference in New York last week, Fidelity Digital Asset Management head Cynthia Lo Bessette said there will be “waves of adoption” in crypto among financial firms.
“The technology is still in early days,” she told the Coinbase State of Crypto Summit in partnership with the FT. “In terms of how we’ve been thinking about where TradFi sits side by side with what we’re seeing developing in DeFi, I like to think of it as — there is going to be an integration.”
Aleks Gilbert contributed to this article. To share tips or information about Bitcoin ETFs or another story, please contact the author at adam@dlnews.com.
