Analyst predicts Bitcoin ETFs will dominate US cryptocurrency ETF trading volume, reaching 99.5%.

Analyst predicts Bitcoin ETFs will dominate US cryptocurrency ETF trading volume, reaching 99.5%.

The Rise of Crypto ETFs in the United States

The United States is set to dominate the global trading volume for crypto-related exchange-traded funds (ETFs) if the Securities and Exchange Commission (SEC) approves spot Bitcoin ETFs. Currently, North America already accounts for 97.7% of all crypto ETF trading volume. Bloomberg senior ETF analyst Eric Balchunas speculates that if spot ETFs are approved in the U.S., the market share could increase to a staggering 99.5%.

Global crypto ETF trading volume

Spot Bitcoin ETFs Waiting for Approval

The current surge in spot Bitcoin ETF applications awaiting SEC approval is causing a lot of anticipation in the crypto industry. The SEC is scheduled to make a decision on Ark Invest’s and 21Share’s joint ARKB fund by August 13th. However, a delay is widely expected.

During a recent Bloomberg interview, Ark CEO Cathie Wood speculated that the SEC might be waiting to approve multiple funds simultaneously. This approach would signify a major step forward in adopting crypto ETFs and would undoubtedly contribute to the dominance of the United States in the global trading volume.

In addition to the awaiting applications, there have been recent updates to existing ETFs. Bitwise filed an updated prospectus on August 10th to change its BITC fund from a Bitcoin futures ETF to the “Bitwise Bitcoin and Ether Equal Weight Strategy ETF”. Similarly, Valkyrie changed its BTC Futures ETF to include Ethereum Futures on August 5th. Industry experts liken these ongoing developments to a “Cannonball Run” effect, indicating the strong momentum and potential for growth in the crypto ETF market.

One notable observation made by Eric Balchunas is that the top 15 equity ETFs in terms of performance this year all have exposure to crypto and blockchain. This statistic highlights the remarkable performance of crypto-related ETFs and the growing interest in this sector.

The Valkyrie Bitcoin Miners ETF sits at the top of the performance charts, boasting a remarkable return of 227% since the beginning of 2023. The fund invests in public companies in the Bitcoin mining industry, such as Marathon Digital, Riot, and Cipher Mining. The strong performance of mining firms has contributed significantly to the ETF’s success.

Following closely behind is the VanEck digital transformation ETF, which has delivered a return of 182% year-to-date. This fund includes investments in various crypto mining and technology firms, including Coinbase, MicroStrategy, Galaxy Digital, Canaan, and Hive.

Other leading crypto-related ETPs include the Global X Blockchain ETF (BKCH) with a 168% return year-to-date, Bitwise Crypto Industry Innovators ETF (BITQ) also returning 168%, and Invesco’s Alerian Galaxy Crypto Economy ETF (SATO) with a 162% return in 2023.

Implications for the Blockchain Industry

The dominance of the United States in the global trading volume for crypto ETFs signifies a significant shift in the acceptance and adoption of blockchain technology. The potential approval of spot Bitcoin ETFs by the SEC would open the door for more investors to participate in the crypto market, further fueling its growth.

These achievements by crypto-related ETFs also demonstrate the immense potential of blockchain technology in revolutionizing traditional financial systems. The strong performance of mining companies and tech firms involved in the crypto space showcases the tangible benefits and profitability associated with blockchain adoption.

The rise of crypto ETFs and their outperformance of traditional funds also highlights the growing interest and demand for blockchain-based investments. As more investors recognize the potential for attractive returns and diversification, the broader adoption of blockchain technology is likely to accelerate.

In conclusion, the approval of spot Bitcoin ETFs in the United States has the potential to solidify the country’s dominance in the global crypto trading volume. The remarkable performance of crypto-related ETFs further underscores the growing interest and acceptance of blockchain technology. As the industry continues to evolve and mature, it is vital for regulators and market participants to foster an environment that encourages innovation while ensuring investor protection. The future of the blockchain industry looks promising as it continues to reshape the global financial landscape.