The historic arrival of Bitcoin exchange-traded funds (ETFs) to Wall Street has been the talk of the crypto world since traditional finance titan BlackRock filed its application for the investment product last June.
After finally getting approval last week and starting trading, BlackRock is doing well: its iShares Bitcoin Trust (IBIT) is now sitting on over $1 billion in assets under management. It is the first spot crypto ETF to cross that threshold.
“We are excited to see IBIT reach this milestone in its first week, reflecting strong investor demand,” BlackRock’s head of digital assets, Robert Mitchnick, said. “This is just the beginning.”
But the price of the biggest cryptocurrency by market cap isn’t looking as good. Bitcoin (BTC) is down 3% in 24 hours and is trading for $41,336, CoinGecko shows.
This time last week, when 10 spot BTC ETFs started trading, the price of the digital coin neared $49,000.
It is now down by more than 11%.
Why? It could have something to do with investors cashing out their gains from the initial ETF hype. As excitement grew in the days, weeks, and even months before the SEC’s eventual approval, more money flowed into Bitcoin. For this reason, some analysts suggested that ETF approval had already been “priced in,” meaning that traders and investors were unlikely to continue buying after the approval was made official.
Analysts at blockchain data firm CryptoQuant said in a report in late December that it expected traders to line up to “sell the news” following the approval of Bitcoin ETFs. The opinion was echoed by analysts at K33 Research, though the firm later reversed its position shortly before ETFs hit the market.
It now appears that initial hunches may have been correct.
Meanwhile, the rest of the crypto market isn’t doing so well either, as altcoins typically follow the market leader. Ethereum (ETH), the second biggest digital coin, is down nearly 3%, trading for $2,470.
Other big losers today include Solana (SOL), which has shed more than 6% of its value over the last 24 hours, and is now priced at $94.46. It’s worth noting, however, that SOL has been on a tear since October, surging by more than 300% from just over $23 per token.
Solana’s resurgence is a reminder that it’s not all bad news for crypto traders at the moment, especially for long-term investors.
Crypto has been largely on a bullish run since December, with increased interest from institutional investors. With Bitcoin ETFs now finally a reality in the United States, the crypto market awaits its promised trillions.