Bitcoin and the rest of crypto went through a brutal cycle in the last two years. Dubbed “crypto winter,” the unforgiving market crushed the hopes of many traders, startup founders, and investors.

Marked by scandals, regulatory uncertainty, and lots of FUD (fear, uncertainty, and doubt in crypto parlance), crypto winter brought down some of the industry’s most significant projects and companies.

However, the US SEC’s successive approvals of eleven spot BTC ETF applications on January 10, 2024, changed all perspectives, turning many bullish.

It’s not just institutions that are optimistic about the development. Even smaller retail traders are excited about the new ETFs. If you are a retail trader sharing your strategies and showcasing a public crypto portfolio for your audience, the rising interest in Bitcoin will likely increase your following and boost your profitability.

New ETF Products Introduced

Wall Street came on strong, with the world’s most prominent asset managers like BlackRock, Fidelity, Valkyrie, VanEck, Franklin Templeton, ArkInvest/21 Shares, Grayscale, Bitwise, Invesco/Galaxy, and WisdomTree launching their Bitcoin ETFs with aggressive fanfare.

The multi-billion- and trillion-dollar institutions promoted and competed Bitcoin-based products in the open market for the first time.

The resulting billions of dollars in inflows broke ETF records and were a massive, unexpected win for Bitcoin. Allocations to US spot Bitcoin ETFs overwhelmed hundreds of millions in outflows to incumbent fund Grayscale Bitcoin Trust (GBTC), raking in over $2.4 billion in the first week.

BlackRock’s IBIT and Fidelity’s FBTC brought in $1.6 billion and $648 million as they rounded up their first week. In addition, the two trillion-dollar asset managers BlackRock and Fidelity and the other funds offering spot Bitcoin ETFs have started a Bitcoin accumulation race. Bitcoin’s price surged at the ETF news, rising past $50,000 for the first time since late 2021.

Thus, Bitcoin’s watershed moment appears to have begun. But what does it imply for money, wealth, and investing? What does it mean for cryptocurrency? Will the lines between decentralized assets and traditional products finally blur? Here, we discuss whether the historic approval of Bitcoin ETFs will mark a defining transformation in crypto and finance.

How Do Spot Bitcoin ETFs Work?

Spot Bitcoin Exchange-traded Funds (ETFs) are financial products traded on public exchanges that track the performance of Bitcoin.

Unlike Bitcoin futures, which were approved years ago and have been traded on the Chicago Mercantile Exchange (CME), spot Bitcoin ETFs hold actual Bitcoin through a registered custodian.

An ETF buys BTC through authorized crypto exchanges or other Bitcoin holders. The Bitcoin is stored in a secure digital wallet using cold storage. Cold storage means the wallet is offline. In the case of spot ETFs, a designated custodian handles the crypto asset’s cold storage and provides additional layers of…

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