Blockchain concept stocks fell broadly. Ebang International ADR dropped 13.6%, Hut 8 fell 10.7%, The9 ADR fell 10.2%, MicroStrategy fell 8.5%, Canaan ADR fell 8.3%, Riot Platforms fell 7.4%, cryptocurrency exchange Coinbase fell 6.2%, and popular brokerage Robinhood fell 5.3%.
The U.S. Securities and Exchange Commission (SEC) approved the first batch of spot Bitcoin ETFs on Wednesday, and they began trading on Thursday, January 11. Bitcoin fluctuated sharply throughout the day. On Thursday morning U.S. Eastern Time, Bitcoin rose above USD 49,000 intraday, reaching its highest level since December 2021 and rising about 6.8% on the day. But the enthusiasm soon faded. Bitcoin turned lower intraday and fell back below USD 46,000. Related ETFs also moved lower.
The poor performance over two consecutive days caused meaningful losses for investors who bought on the first day of listing. Using BlackRock’s ETF as an example, an investment of USD 10,000 on Thursday was worth only USD 8,300 on Friday.
Well-known U.S. financial commentator Peter Schiff said:
So far, the sell-off in Bitcoin, Bitcoin ETFs, and other Bitcoin-related stocks has been unexpectedly orderly. I wonder when the selling will become more aggressive.
In fact, from the fund flow data, besides direct Bitcoin selling for cash, competition among Bitcoin ETFs has also been extremely intense. Capital has flowed from ETFs with higher fees into cheaper ones:
Although nearly half of yesterday’s Bitcoin ETF trading volume came from the Grayscale ETF, making it the third-largest ETF by trading volume on record, trading volume does not represent investor inflows or outflows. Funds were actually flowing out of Grayscale’s ETF.
Wallstreetcn previously mentioned that after the initial promotional period for the fund launch, Bitwise’s BITB charges only 0.20%, the lowest fee among all ETFs, and it saw the largest inflow. Other ETFs also saw varying levels of net inflows.
