Spot Bitcoin ETF Approval Could Skyrocket U.S. Crypto ETF Trading Volume

The potential approval of spot Bitcoin exchange-traded funds (ETFs) could propel the United States into a position of dominance, accounting for a staggering 99.5% of global crypto ETF trading volume, per insights from Bloomberg’s senior ETF analyst Eric Balchunas. North America already commands a 97.7% share of all crypto ETF trading volume.

Balchunas shared this perspective on August 10th through a tweet, emphasizing that this substantial shift would largely hinge on the introduction and approval of spot Bitcoin ETFs in the U.S. Once realized, this development could cause North America’s crypto ETF trading volume to surge even closer to total market domination, at a projected 99.5%.

However, this potential awaits the U.S. Securities and Exchange Commission (SEC) verdicts on various spot Bitcoin ETF applications. One such decision is expected for Ark Invest’s and 21Shares’ joint ARKB fund by August 13th, though anticipation of a delay has circulated.

Notably, Balchunas also mentioned the possibility that the regulator might be holding out for a simultaneous approval of multiple funds, a conjecture shared by Ark CEO Cathie Wood in a recent Bloomberg interview.

In the ongoing ecosystem of crypto ETFs, notable adjustments are being made. Bitwise recently updated its prospectus to transform its BITC fund from a Bitcoin futures ETF to the “Bitwise Bitcoin and Ether Equal Weight Strategy ETF.” This move aligns with the trend set by Valkyrie, which tweaked its BTC Futures ETF (BTF) to encompass Ethereum Futures.

Balchunas aptly described the ongoing developments as a “Cannonball Run in effect,” indicative of rapid and dynamic changes within the space as the crypto ETF landscape evolves.

Furthermore, Balchunas highlighted the exceptional performance of crypto-related ETFs this year. In terms of performance, the top 15 equity ETFs have all demonstrated exposure to cryptocurrencies and blockchain technology. The Valkyrie Bitcoin Miners ETF led the pack with a staggering 227% return since the start of 2023. This ETF focuses on public companies in the Bitcoin mining sector, including Marathon Digital, Riot, and Cipher Mining.

Other prominent crypto-related ETFs also made their mark, including the VanEck digital transformation ETF and the Global X Blockchain ETF, both boasting significant returns. These performances underscore the fervor surrounding cryptocurrencies and their ecosystem, fueling investment and market enthusiasm.

Approving spot Bitcoin ETFs in the U.S. can significantly shift the global trading volume dynamics. North America’s position of influence could intensify, with crypto-related ETFs leading the performance charts. These trends underscore the ever-evolving nature of the crypto landscape and the growing enthusiasm for digital assets and their associated investment products.