Over $500 million was quickly taken out of US spot Bitcoin ETFs, which has caused an enormous shock in the cryptocurrency market and is being called the “worst day by far” for this section by analysts.
A well-known cryptocurrency trader and co-founder of Messari, Qiao Wang, didn’t mince words when he said that May 1st was the worst day ever for exchange-traded funds based on spot Bitcoin (BTC). A shocking $500 million was taken out of the net value of BTC ETFs during this terrible session.
Fidelity Investments’ Fidelity Wise Origin Bitcoin Fund (FBTC), which lost $191 million, was hit the hardest by this flight. At the same time, over half of the $500 million in losses were caused by goods from industry giants Grayscale and ARK.
Bitcoin Analysts Blame Exodus
Analysts like Wang and his colleague Jim Bianco have attributed the exodus to a prevalence of “paper hands” among the initial cohort of Bitcoin spot ETF holders. This sentiment echoes the three tumultuous trading days on April 24th, 25th, and 30th, culminating in May 1st’s record-breaking plunge – the sixth consecutive day of losses for Bitcoin ETFs.
Jim Bianco was right that ETF holders were paperhands, FOMOing on the way up jeering on the way down.Qiao Wang
At the same time that the story of spot Bitcoin ETFs is being told, similar products were just released in Hong Kong. Even though it didn’t have a great start, with an Asset Under Management (AUM) of $140 million and a trading volume of $12.1 million equivalent, there is still hope for future institutional participation.
For example, Mr. Wang stays cautiously optimistic and thinks that future versions of Bitcoin Spot ETFs could attract a lot of loyal institutional investors. He thinks that major asset managers just need some time to get used to how things are changing.
But the cryptocurrency market as a whole is still very unstable. After BTC fell below $57,000, CoinGlass data shows that nearly $600 million worth of long contracts were closed over the previous two days. This shows how risky digital assets can be.
