Bitcoin ETFs Smash Records with Massive Trading Volume in Just 3 Days

By Aaron Feuerstein January 17, 2024 In ETFs
  • Despite high expectations, the approval of the Spot Bitcoin ETFs in the US led to an underwhelming Bitcoin price reaction, with a 6% decline over seven days following the SEC’s decision.
  • The trading volume of the newly approved ETFs starkly contrasts with its subdued price performance, outpacing the combined volume of 500 ETFs launched in 2023.
  • Today saw a net outflow from Bitcoin ETFs, with around USD $594 million (AUD $901 million) withdrawn from the Grayscale Bitcoin Trust (GBTC).
  • This led to a total outflow of USD $1.173 billion (AUD $1.779 billion), and inflows in other Bitcoin ETFs are not expected to offset this significant withdrawal.

Bitcoin Price Reaction to ETF Lacklustre

The Spot Bitcoin ETF approval in the US was the hottest topic on everyone’s mind over the past few weeks and months. And while the approval is done and dusted, many had expected a Bitcoin price explosion following the event. However, BTC wasn’t convinced and has since lost USD 3,000 (AUD $4,553) or around 6% in the past seven days since the decision by the US Securities and Exchange Commission (SEC).

Bitcoin (BTC), seven-day chart, source: CoinMarketCap

While the approval may have been priced in short-term, the long-term outlook remains bullish. As trader Michaël van de Poppe says these corrections are all part and parcel of investing and shouldn’t deter anyone from HODLing.

ETF Volume Tells Different Story Than Price

Compared to the price performance, the actual ETFs are far from sluggish. As Bloomberg Senior ETF analyst Eric Balchunas reports, there has been USD $10 billion (AUD $15 billion) in volume in the first three days of trading. He compares this to the 500 ETFs launched in 2023 which ‘only’ had a combined volume of USD $450 million (AUD $683 million) in daily trades.

Bitcoin ETF three-day trading volume, source: Bloomberg

Net Outflow Day for ETFs

The most recent data indicates that today was a day where more money was being withdrawn from Bitcoin ETFs than is being invested. Specifically, Bloomberg’s James Seyffart estimated that around USD $594 million (AUD $901 million) has been withdrawn from the Grayscale Bitcoin Trust (GBTC), leading to a total of USD $1.173 billion (AUD $1.779 billion) in outflows.


Although other Bitcoin ETFs are seeing some inflows, these are not expected to be sufficient to balance out the significant outflow from GBTC. Seyffart says this situation is notable because it reflects a substantial movement of funds out of a major Bitcoin investment vehicle, which could have implications for the Bitcoin market and investor sentiment.

The analyst also suggests that the significant outflow from the Grayscale Bitcoin Trust (GBTC) in today’s data is actually a reflection of trading activities that occurred on Friday, but are only now being fully accounted for due to these standard settlement procedures in financial markets.

Aaron Feuerstein

Aaron Feuerstein

Aaron Feuerstein is a freelance writer based in Melbourne. His focus is on decentralised finance and the regulatory space surrounding blockchain. He holds a Master's in Accounting. When he is not studying the latest legal case, he enjoys his time as a modest but eager hobby cook.

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