Bitcoin ETP volumes surge as institutions jump into the BTC bull run

Institutional Bitcoin products are booming as the pioneer cryptocurrency sees bullish price action.

A report shared with CryptoSlate from crypto research firm CryptoCompare found that the aggregate volumes for popular Exchange-traded Products (ETPs) surged 53% this year with several products demonstrating “above-market” returns. 

Of these, Grayscale’s popular Bitcoin Trust product surpassed $9 billion in market cap while 3iQ’s Bitcoin Fund (QBTC) experienced its highest returns over the last 30 days at 49.1%.

?? @Grayscale‘s #Bitcoin Trust saw record weekly #BTC inflows in October & surged 50% to reach $9.1bn in market cap. #ETCGroup’s #BTCE had the greatest increase in market cap, nearly doubling to $116mn while @WisdomTreeETFs‘ #BTCW saw a 65% increase. https://t.co/jmNDalF2W1 pic.twitter.com/QvBE3LF7ZY

— CryptoCompare (@CryptoCompare) November 17, 2020

Researchers found that the average November ETP volumes had increased by 53.5% to $173.5 million per day. Similarly, Grayscale’s Bitcoin Trust Product surged 50% to reach $9.1 billion in market cap with record weekly BTC inflows seen in October.

A smaller ETP player, the ETC Group, saw its BTCE product jumping to a $116 million market cap in the past month, representing a massive 93% compared to the last period. The product’s average volumes tripled in November to $8.87 million a day (an increase of 212% since October’s average).

However, it was 3iQ’s Bitcoin Fund (QBTC-U) that experienced the highest 30-day returns at 49.1%, followed by WisdomTree’s BTCW (39.1%) and Grayscale’s GBTC (38.4%). On the other hand, Grayscale’s Digital Large Cap Fund (GDLC) experienced a 30-day loss of 20.6% over the last 30-days.

Canadian Bitcoin fund posts biggest market cap

Excluding Grayscale’s OTC-traded products, the largest ETP by market cap is currently 3iQ’s Bitcoin Fund product (QBTC), which is traded predominantly on the Toronto Stock Exchange. Its market cap surpassed $105 million in October and now stands at $167 million.

ETC Group’s BTCE product is currently the second-largest such product and saw the greatest increase in market cap, nearly doubling to $116mn (+93% since 30-days prior) while BTCW by WisdomTree experienced a 65% increase to $79mn.

Meanwhile, ETP trading activity for non-OTC products has also seen a significant boost in volume in November – ETC Group’s BTCE which trades on Deutsche Börse XETRA has tripled its volume to $8.87 million a day, while 3iQ’s QBTC-U volume has increased 52.8% to reach $2.29 million a day.

The report comes as Bitcoin crossed the $18,000 mark earlier today—a price last seen in the first week of January 2018. Institutional adoption is also reaching all-time highs for Bitcoin, as hedge fund managers, software companies, and prominent billionaires turn to the asset seeking a hedge against inflation in the traditional markets.

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