Bitcoin ETFs in the U.S. are off to a raucous start. It’s only midday, and already the 11 spot Bitcoin ETFs just yesterday approved by the SEC have combined for $1.9 billion worth of trading volume, exceeding analyst expectations.

Despite spiking to nearly $49,000 just after markets opened in the U.S., Bitcoin was relatively subdued on Thursday. At the time of writing, it was changing hands at $46,610.54, according to CoinGecko.

BlackRock’s iShares Bitcoin Trust (IBIT) and the Fidelity Wise Origin Bitcoin Trust (FBTC) have far and away led the pack, accounting for 41% and 27% of that volume, respectively. These two ETFs alone have generated $1.3 billion in trading volume so far.

Among the non-Wall Street set, the ARK 21Shares Bitcoin ETF (ARKB) has done roughly $208 million—about 13%—of total volume by 1 p.m. ET on Thursday.


In October, when the race to offer a Bitcoin ETF seemed to be just heating up, Adam Guren, the co-founder of crypto hedge fund Hunting Hill Digital, told Decrypt that blowout ETF launches aren’t all that common.

“Even attaining $500 million in day-one inflows as a noteworthy challenge,” he said.

Last week, Dave Nadig of VettaFi and co-author of “A Comprehensive Guide to Exchange-Traded Funds” told Decrypt that if the approved funds launched with the Grayscale Bitcoin Trust in the mix, then GBTC might soak up most of the volume—but not for the reasons the firm might want.

“Where the volume shows up is a little bit of a secret sauce, mystical union quest,” Nadig said last week, adding that “if GBTC is included in that initial launch, it could get all the volume because there are a lot of people who are already in it that may want to unload it.”


The Grayscale Bitcoin Trust (GBTC) has accounted for $217 million worth of the opening day volume, approximately 12% of the total that’s traded so far. But GBTC isn’t a perfect 1:1 comparison to all the ETFs that just began trading today. GBTC began as an investment product available to accredited investors in 2013.

As part of the SEC approvals yesterday, Grayscale was allowed to convert GBTC into a spot Bitcoin ETF.

The Securities and Exchange Commission made history yesterday afternoon when it approved rules changes that would allow the Bitcoin ETFs to trade on the NYSE Arca, Nasdaq, and Cboe. The industry has been pushing for such products to be available to U.S. investors for the better part of a decade. That’s because spot Bitcoin ETFs offer a way for investors to get exposure to BTC as an asset without having to actually buy and store the cryptocurrency.

But the ease with which investors can now gain exposure to BTC through ETFs comes at a price. By design, exchange-traded funds (ETFs) charge a sponsor’s fee—which pays for all the overhead taken on by the issuer and management of assets. In the days leading up to yesterday’s SEC approval, issuers played a dizzying game of fee limbo.

After initially setting its fee at 0.30%, which analysts said was very competitive, BlackRock turned up the heat on its competition by lowering it to 0.25% on Wednesday—just hours before the SEC approved all the funds for trading.

And it’s highly unlikely that any of the funds raise their fees in the future, said Bloomberg Intelligence analyst Eric Balchunas.

“ETFs only cut fees, never raise them,” he explained on Twitter yesterday, when asked what the odds were that the ETF issuers would hike up the fees later. “Advisors would flip out if they did and their brands would be stained.”


The huge debut comes at the same time a number of financial institutions, including Vanguard and Merrill Lynch, have made the decision to ban their customers from buying shares of the Bitcoin ETFs through their trading platforms.

Merrill Lynch immediately responded to a request for comment from Decrypt.

Vanguard hasn’t been totally averse to crypto assets in the past. Just six months ago, it upped its holdings of Bitcoin mining companies Riot Blockchain (RIOT) and Marathon Digital (MARA). But its comfort with owning Bitcoin mining stocks as an institution does not translate into seeing spot Bitcoin ETFs as a suitable investment for clients.

"While we continuously evaluate our brokerage offer and evaluate new product entries to the market, spot Bitcoin ETFs will not be available for purchase on the Vanguard platform," a Vanguard spokesperson told Decrypt in a statement. "We also have no plans to offer Vanguard Bitcoin ETFs or other crypto-related products."

 The statement continued that the Bitcoin ETF products "do not align" with Vaguard's view that a well-balanced, long-term investment portfolio should include asset classes such as equities, bonds, and cash.

Meanwhile, Merrill Lynch told Fox Business that Merrill Lynch has decided on a wait-and-see approach because it’s unsure whether the Bitcoin ETFs will trade efficiently.

Editor's note: This story was updated at 3:00 p.m. ET to add a comment from Vanguard.

Edited by Guillermo Jimenez.


Daily Debrief Newsletter

Start every day with the top news stories right now, plus original features, a podcast, videos and more.