Record-breaking Trading Volumes as Traders Flock to US Crypto Products Following Spot ETF Approvals

by Jan 16, 2024CryptoNews0 comments

Traders have shown a strong interest in US crypto products following the approval of spot ETF approvals fuelled a surge in trading volumes, leading to record-breaking weekly trading volumes for crypto investment products, as reported by CoinShares. According to CoinShares’ report on digital asset fund flows, US-based funds experienced significant inflows, reaching a staggering $1.24 billion for the week ending on January 12. In contrast, products based in Canada, Germany, and Sweden saw outflows as basis traders shifted their focus from Europe to the US. Canadian products witnessed the highest outflows, totaling $44.2 million, while Swiss-based products attracted $24.2 million in inflows.

Crypto product fund flows by country
Crypto product fund flows by country. Source: CoinShares

The approval of 11 spot Bitcoin ETF products by the US Securities and Exchange Commission (SEC) on January 10, with 10 of them launching the following day, played a pivotal role in driving up trading volumes. These trading volumes reached a new weekly all-time high of $17.5 billion, accounting for nearly 90% of the daily trading volumes on reputable exchanges. CoinShares’ head of research, James Butterfill, noted that while the total weekly inflows of $1.18 billion were significant, they did not break previous records. In comparison, the launch of Bitcoin futures ETFs in October 2021 resulted in $1.5 billion of inflows within the first week.

During the week, Bitcoin products witnessed the highest inflows, amounting to $1.16 billion, followed by Ether (ETH) funds with nearly $25 million. Bitcoin short funds also saw inflows of $4.1 million. Ripple’s XRP followed with inflows of $2.2 million. However, Solana (SOL) funds were the exception, attracting only $500,000 in inflows. Among the crypto-linked ETFs, ProShares’ spot Bitcoin Strategy ETF stood out with the largest weekly inflows of $265.2 million, while Grayscale Investments products experienced outflows totaling $579.1 million.

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The spot ETF approvals fuelled surge in trading volumes and inflows into US crypto products demonstrates the growing appeal and demand for cryptocurrency investments. The approval of spot Bitcoin ETFs by the SEC has played a significant role in attracting traders and investors, resulting in increased market participation and liquidity.

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