Bitcoin's Shock Drop
Crypto has patiently awaited spot Bitcoin ETFs for the better part of a decade. They were approved and started trading this week! While it feels like there are plenty of reasons to celebrate, BTC has cratered a shocking 12.4% off its ETF debut high. WTF happened to TradFi buying our bags?
The total crypto market cap has plunged since spot BTC ETFs hit the market, with Bitcoin leading the decline as longs have come to the sudden realization that they are offside.
While the newborn spot BTC ETFs have managed to accumulate $1.4B in AUM over the past two days and are living up to analyst expectations, crypto prices have continued to plunge, with market participants that were over-bullish on ETF approval narratives being forced to walk back their bets.
Despite the poor week for Bitcoin, it was crypto equities that suffered the most; price drops on high-flying tickers like MicroStrategy (MSTR) and Coinbase (COIN) outpaced those of BTC!
The arrival of spot BTC ETFs has given investors a better way to access crypto exposure than using crypto equities as a proxy; outflows from the group are the direct result of investors wanting crypto exposure in their portfolio rotating from equities into the underlying asset.