ProShares BTC ETF Hits $1 Billion on First Day

The debut of the ProShares Bitcoin Strategy ETF sees it becoming one of the biggest first days for any ETF EVER.

By
Anirudh Tiwari
on
October 21, 2021
Category:
Blockchain News

Landmark Moment for BTC

The Proshares Bitcoin Strategy ETF debuted on New York Stock Exchange (NYSE) Arca on Oct. 19 with a bang, recording volumes over $1 billion on the first day.

This ETF is the first cryptocurrency-based exchange-traded fund (ETF) to be approved by the United States Securities and Exchange Commission (SEC) after over 20 ETF applications were submitted to the regulator over the recent years.

The ETF’s day one performance could even be the most successful ETF performance of all time in terms of ‘natural volume,’ as per Eric Balchunas, senior ETF analyst at Bloomberg, in a Twitter post.

“Slight pullback in its price during the first hour was likely due to pre-launch funds taking advantage of arbitrage opportunities to exit the market after the run-up in price, but the futures ETF is the better product for professional investors seeking BTC exposure in the short- to mid-term” stated Du Jun, co-founder of Huobi Group, in a conversation with BSC News about why the price of the ETF took a setback shortly after its launch.
Source: TradingView BITO Chart

The debut makes it one of the most successful performances in the history of ETFs across asset classes. BITO, the share ticker for the listed ETF, opened the day exchanging hands at $40.88, with the closing price being $41.94, as per data from TradingView. Over 24.41 million shares of the ETF were traded on the exchange in the same duration. At the time of writing, the ETF’s share is trading at $43.54, 6% up from its opening price yesterday.


ProShares ETF Drove BTC to New All-Time High

As previously reported by BSC News, the news of the first BTC ETF approval by the SEC sent the price of Bitcoin soaring past $60,000 for the first time in six months. 

Just a day after the listing on the ETF on NYSE Arca, BTC reached a new all-time high of 66,930 on Oct. 20. On the same day, the ETF has already posted an even more successful day by 1 PM in local trading time with a volume of 26.19 million shares traded till then. 

Source: CoinMarketCap - BTC Year-to-date chart
“The short-term impact has already shown on BTC’s price, indicates strong confidence in the crypto industry. The market expects to see more bitcoin futures ETF be approved, which fuels the confidence of investors,” further explained Jun about the ETF’s launch. 

Jun also recognized the high demand that followed as one of the primary reasons BTC broke its previously set all-time high on Oct. 20.

The next ETF set to be approved by the SEC is Valkyrie’s Bitcoin Strategy ETF. This iteration will also be a futures-based ETF similar to the ProShares ETF. Some analysts have even highlighted the pitfalls that futures-based ETFs entail. However, Jun remains optimistic about this approval.

“The pass signals that BTC is recognized as a more mature asset or commodity under the regulatory view. It also brought BTC exposure to a wider range of investors in a mainstream, large liquidity marketplace. Such a milestone affected the market positively,” opined Jun on the market-wide impact of the SEC’s approval of the ProShares ETF listing.

However, this is not the first ETF that has been offered to investors. The Canadian regulators have already approved several Bitcoin and Ethereum ETFs that are listed on Canadian exchanges. The most prominent of these are Purpose Bitcoin ETF and the Evolve Bitcoin ETF with assets under management (AUM) of $1.4 billion and $168 billion, respectively.

“Looking ahead, the market will continue to be receptive, and we expect the ETF's price to remain in line with Bitcoin's price trends. However, its market share faces potential competition from competitor products such as those soon to be launched by Valkyrie. Premiums and fees may fall after the launch of other Bitcoin futures ETFs,” explained Du Jun on what the future holds for the listed ETF.

As reported by Bloomberg, the ETF fee wars have already begun to heat up with the impending launch of the Valkyrie ETF at a lower fee than the ProShares ETF. Balchunas further mentioned on his Twitter account that this launch could very well be tomorrow with the ticker ‘BTF.’

About ProShares

ProShares is a company that has been spearheading the ETF revolution since 2006. They have a huge line-up of ETFs that encapsulate various asset classes like equities, fixed income products, alternative investments, and now even cryptocurrencies, totaling over $67 billion in assets. The firm aims to innovate with products that allow investors strategic and tactical opportunities, enabling them to manage risk and enhance returns.

Find more about the ProShares here:

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Anirudh Tiwari

Anirudh is a cryptocurrency analyst and writer who specializes in derivatives, DeFi, regulations and CBDCs. He has a Master’s degree in Finance. Before delving into crypto, he worked with a leading U.S. based investment bank. Apart from work, he is a music connoisseur and likes to play the drums. His largest holdings in crypto are Ethereum, Cardano, and Polkadot.

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