Recent spot introductions have increased outflows of European Bitcoin exchange-traded products. BTC
-4.06%
One analyst said the U.S. ETF
Luke Nolan, a researcher at CoinShares, said this market shift highlights a trend among institutional traders in the US shifting their investment strategies to recently approved spot Bitcoin ETFs.
“There have been significant outflows from European Bitcoin ETPs. Before the approval of several spot Bitcoin ETFs, many U.S. institutions utilized European ETPs for virtually risk-free primary trading. However, with the recent approval of new U.S. products, these institutions may find it more cost-effective or convenient to execute the same underlying transaction domestically,” Nolan told The Block.
According to Nolan, these fundamentals offer U.S. institutional investors a relatively risk-free deal.
“American investors were selling Bitcoin futures, but at the same time buying the underlying asset through European ETPs, allowing them to exit the contract and profit from the basis difference, which in this case is a premium over the price of the underlying asset. But now they are more In a convenient way, we can do the same domestically through spot Bitcoin ETFs,” Nolan added.
In futures trading, basis refers to the spot price of an asset or the difference between the spot price and the futures price of a specific contract.
Market changes after spot Bitcoin ETF approval
The four largest Bitcoin ETPs in Europe have experienced significant outflows since the launch of the spot Bitcoin ETF last week, according to data from BitMEX Research.
“Data is available for Europe where people are switching from high-fee Bitcoin ETPs.” BitMEX Research Posted At X.com.
European Bitcoin ETP outflows increased this week. Image: BitMEX Research.
Canadian Bitcoin ETP outflows also surged noticeably.
“With respect to Canadian Bitcoin ETPs, it appears that even U.S. investors who had a way to invest in Canadian ETPs are switching to investing in new U.S. funds,” Nolan added.
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