As the largest investment organizations increasingly offer these funds to their clients, cryptocurrency ETFs are rapidly gaining popularity. Recently, the US Securities and Exchange Commission (SEC) greenlit bitcoin exchange-traded funds, prompting Bank of America’s Merrill and Wells Fargo to grant select wealth management clients access to them, as reported by Bloomberg.
Bitcoin ETFs: Establishment Giants Enter the Crypto Sphere
Major asset managers in the US, including Fidelity and BlackRock, have emerged as issuers of Spot Bitcoin ETFs. Initially, traditional banks and wirehouses were hesitant to offer this product to clients. Vanguard, Citi Bank, and UBS abstained from embracing the Bitcoin-backed investment vehicle upon its launch, according to earlier reports.
The acceptance of bitcoin ETFs by mainstream brokerage platforms underscores the shifting perspective of large corporations towards cryptocurrencies, viewing them as viable investment avenues rather than purely speculative assets.
Retail investors now have the opportunity to track bitcoin price fluctuations through exchange-traded funds (ETFs) without the necessity of purchasing the cryptocurrency directly from less regulated exchanges.
RIDIC: the New Nine doubled their volume record (set Monday) with just about $6b traded.. $IBIT led w $3.3b of it, Fidelity did $1.4b (both double their prev records). The total number of trades was double too, over half a million individual trades bt them. $IBIT alone > $QQQ. pic.twitter.com/ZzB5PWXA4f
— Eric Balchunas (@EricBalchunas) February 28, 2024
The price of bitcoin has surged recently, briefly hitting $64,000 on Thursday, just shy of its all-time high of approximately $69,000 in 2021.
In a statement sent via email on Thursday, Wells Fargo disclosed that spot bitcoin ETFs are available for “unsolicited purchases” through advisors with Wells Fargo Advisors or via their online WellsTrade platform.
With the rising prices of Bitcoin, spot Bitcoin ETF providers have amassed over $20 billion in assets under management (AUM). As the ETF wrapper attracts investments from retail investors, hedge funds, and other capital allocators, the token has seen a 50% increase in value so far this year.
Moreover, these investment vehicles have witnessed record-breaking trading volumes in the weeks following the approval of 11 spot bitcoin ETFs by US regulators in January. Bloomberg’s James Seyffart reported that trading activity for 10 ETFs surpassed $7.7 billion this week.
The new record for #Bitcoin ETF trading volume is officially $7.69 billion. Previous record was $4.66 billion from launch day. https://t.co/rZsOSUqk35 pic.twitter.com/QaOKe2LuVU
— James Seyffart (@JSeyff) February 28, 2024
Morgan Stanley Eyes BTC ETF
Meanwhile, Morgan Stanley, a prominent Wall Street institution, is reportedly contemplating offering spot BTC ETF trading to its clients. Matt Hougan, Bitwise’s chief investment officer, suggests that additional trading giants are likely to enter the market, potentially channeling billions of dollars in untapped capital into Bitcoin via ETFs.
Gautam Chhugani, an analyst at Bernstein, expressed confidence earlier this week, asserting that bitcoin is on an “18-month road to $150,000” driven by unprecedented institutional adoption.
At the time of writing, Bitcoin was trading at $61,200, marking a 1.5% increase daily and a 19.2% increase weekly, according to data from Coingecko.
