By Larry Wright
Bitcoin ETFs are all the rage these days. These derivatives for digital assets hold a special status in the marketplace. When new ETFs are approved and listed Bitcoin price mark is improved considerably. Canada has been forward in the field of exchange-traded funds. At the beginning of the year, the Ontario Securities Commission approved Bitcoin pegged EFTs by Purpose Investments.
Purpose Investments is an asset management company that has branched out in digital assets recently. As soon as the ETF was introduced, it gained a lot of attention from investors and major players in the market. In a matter of a few weeks, the Purpose investment BTC tracking ETF was hosting $400 million in assets under management. However, after the April market crash, the institutional investors started to lose control. The latest metrics from the markets are showing better results.
Bad news from all directions strikes with the crypto markets as soon as May 2021 started. The first strike came when reports about Tesla selling 10% of its Bitcoin holdings came to light. This set off a FUD in the market, and investors started to panic selling, driving down the price of the golden cryptocurrency. Soon after, China turned its back on the crypto miners.
Lastly, Musk took to Twitter and criticized the leading cryptocurrency due to the detrimental effects of BItcoin mining on the environment. All of these occurrences not only shot down the Bitcoin price but also harmed the ETF. Many investors stopped adding more funds to the ETF, and after some time, a significant number of investors sold out their holdings as well. However, the data from Glassnode indicates that in the last two months, investors have started to return, and the Bitcoin concentration increased by 30%.
When will United States Issue the Bitcoin ETF?
The Purpose ETF has become more stabilized recently. In the last two months, around 3,446 Bitcoin was transferred to the fund. By adding an average of 86.15 Bitcoin blocks per day, the total holdings of the Purpose fund have reached 22,500 BTC. At press time, Bitcoin is trading for $35K, putting the value of the fund around $800 million.
Meanwhile, the SEC continues to delay a massive number of Bitcoin ETF applicants. Hester Peirce, Commissioner at SEC, told the media that SEC is stalling for time. He further added that a Bitcoin ETF should have been approved by now. Peirce also believes that SEC is lagging due to outdated examination methods that are unsuited for cryptocurrencies derivatives.