Institutional Frenzy: Billions Flood into Crypto Markets After Bitcoin ETF Approval, While Vanguard Apologizes to Its Customers After Removing Option to Invest in BTC ETF

• The U.S. SEC’s approval of a spot BTC ETF has led to a significant $1.18 billion inflow into BTC investment products.
• Vanguard faces criticism and client dissatisfaction for not expanding access to Bitcoin investments, indicating a potential shift in its stance.

According to the latest Digital Asset Fund Flows Weekly Report by CoinShares, Bitcoin (BTC) investment products experienced a substantial influx, totaling $1.18 billion last week. This surge in investment followed the landmark approval of a spot BTC Exchange-Traded Fund (ETF) by the U.S. Securities and Exchange Commission (SEC).

The report further illuminates several key developments in the digital asset space:

1. Digital asset investment products witnessed inflows of US$1.18 billion last week (subject to T+2 settlement). Although significant, this amount did not surpass the record set by the launch of the futures-based Bitcoin ETFs.
2. Trading volumes reached a record high of US$17.5 billion last week, a substantial increase compared to the 2022 weekly average of US$2 billion.
3. The United States accounted for US$1.24 billion of these inflows, contrasted with minor outflows observed in European markets.

In a related perspective, Eric Balchunas, Senior ETF Analyst at Bloomberg, recently shared a tweet showcasing an insightful chart. This chart, derived from his colleague Sebastien Cabral’s analysis, breaks down the Day One volume of $IBIT by time of day and exchange, highlighting the extensive listing of ETFs.

Really cool chart showing $IBIT’s Day One volume broken down by time of day and exchange (which shows off just how many places an ETF gets listed on) via my colleague ⁦@thetrinianalyst⁩ who is working today bc he’s in London pic.twitter.com/Rj5ZNYLL9d

— Eric Balchunas (@EricBalchunas) January 15, 2024

In a contrasting development, Vanguard Asset Management displayed reluctance in expanding access to Bitcoin investments, as earlier reported by CNF. A post shared on Coin Market Cap reveals apologies issued by Vanguard representatives for their lack of foresight in cryptocurrency investment opportunities. Market advocate Mike Alfred reported conversations with Merrill and Vanguard, where he requested the withdrawal of his investments. He mentioned that Senior Account Managers at both firms apologized, acknowledging the widespread client complaints regarding the same issue.

This situation raises questions about Vanguard’s position on cryptocurrency. A Bloomberg Analyst commented on the issue, suggesting that the concerns might be overblown. He pointed out that Vanguard’s asset growth last year exceeded the entire market capitalization of Bitcoin.

No need for the crazy talk. Vanguard's assets grew more last year than btc's entire mkt cap. You guys actually have some traits in common. Vanguard/Bogle has always had anti-Wall St populist chip on their shoulder just like btc folks and HODLs with navy seals-level discipline. https://t.co/BI9AhjeRnl

— Eric Balchunas (@EricBalchunas) January 15, 2024

He also drew parallels between the anti-Wall Street sentiment of Vanguard/Bogle and the Bitcoin community, noting their shared discipline and resilience.

In the cryptocurrency market, Bitcoin currently trades at $42,919.67, having risen 0.57% in the last 24 hours after a 7.78% decline over the past week. While the ETF’s trading volume was notably high, Bitcoin’s overall trading volume decreased by 21.149%.