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Spot Bitcoin ETFs Hit $50 Billion in Trading Volume

The popularity of spot Bitcoin exchange-traded funds (ETFs) has reached new heights, as the cumulative trading volume of these cryptocurrency investment products surpassed $50 billion in just six weeks since their launch. This remarkable achievement reflects the growing demand and confidence of investors in these regulated and transparent vehicles that track the price of Bitcoin.

Spot Bitcoin ETFs are funds that hold actual Bitcoin in custody and issue shares that represent a proportional ownership of the underlying asset. Unlike futures-based Bitcoin ETFs, which trade contracts that expire at a certain date and may deviate from the spot price of Bitcoin, spot Bitcoin ETFs aim to provide investors with exposure to the real-time value of Bitcoin without the hassle of buying, storing, and securing the cryptocurrency themselves.

The first spot Bitcoin ETFs in the U.S. were approved by the Securities and Exchange Commission (SEC) in early January, after years of rejections and delays. The SEC cited the improved market structure, liquidity, and surveillance of the Bitcoin market as the main reasons for granting approval. Since then, several prominent players in the financial industry have launched their own spot Bitcoin ETFs, such as BlackRock, Fidelity, Bitwise, VanEck, and Valkyrie.

According to data from BitMEX Research, the spot Bitcoin ETFs have seen a surge in trading volume since their debut, reaching a cumulative total of $50.5 billion by the end of the trading day on Thursday, Feb. 22. The data also shows the performance of the major spot Bitcoin ETFs in terms of trading volume, net flows, and premiums or discounts to the net asset value (NAV) of the funds.

The data reveals that Tuesday, Feb. 20, was a record-breaking day for spot Bitcoin ETFs, as they traded over $2.5 billion in volume, the highest since their launch. On Thursday, Feb. 22, the spot Bitcoin ETFs traded $1.2 billion in volume, with BlackRock’s IBIT leading the pack at $457.2 million, followed by Grayscale’s GBTC and Fidelity’s FBTC at $348.8 million and $255.7 million, respectively.

The data also shows that Thursday, Feb. 22, was a positive day for spot Bitcoin ETFs in terms of net flows, as they recorded net inflows of $251.4 million, reversing the trend of net outflows that occurred on Feb. 21. Fidelity’s FBTC led the inflows with $158.9 million, followed by BlackRock’s IBIT with $125.1 million, while Grayscale’s GBTC saw $55.7 million in outflows.

The data further reveals that the spot Bitcoin ETFs traded at varying premiums or discounts to their NAV, which indicates the difference between the market price and the underlying value of the funds. A premium means that the market price is higher than the NAV, while a discount means that the market price is lower than the NAV. A high premium or discount may indicate a high demand or supply for the fund, or a discrepancy between the fund’s price and the spot price of Bitcoin.

The data shows that on Thursday, Feb. 22, the spot Bitcoin ETFs traded at an average premium of 0.12%, with Fidelity’s FBTC having the highest premium of 0.28%, followed by BlackRock’s IBIT with 0.16%, and Grayscale’s GBTC with 0.04%. The data also shows that the spot Bitcoin ETFs have traded at an average premium of 0.15% since their launch, with Fidelity’s FBTC having the highest average premium of 0.24%, followed by BlackRock’s IBIT with 0.18%, and Grayscale’s GBTC with 0.09%.

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