Bitcoin ETFs Hit Record Trading Volumes At $10 Billion Amid BTC Price Volatility (2024)

Bitcoin ETFs continue their market dominance with staggering trading volumes despite the Bitcoin (BTC) price volatility on Tuesday, March 6. On Tuesday, March 5, the total trading volumes across all ten Bitcoin ETFs crossed a staggering $10 billion as the BTC price exhibited massive volatility of $10,000 fluctuating between $69,000 and $59,000.

Ten Bitcoin ETFs Shatter Volume Records

According to Bloomberg ETF strategist Eric Balchunas, the surge in trading activity comes as no surprise, considering the inherent volatility associated with ETFs. However, the magnitude of today’s trading numbers is remarkable, especially for ETFs that are less than two months old.

Several ETFs, including $IBIT, $FBTC, $BITB, and $ARKB, witnessed record-breaking trading days, indicating a growing investor interest in cryptocurrency-based exchange-traded products. In fact, BlackRock’s IBIT Bitcoin ETF clocked its highest-ever daily inflows at a staggering $788 million. Fidelity’s FBTC came second with $125 million in net inflows, as per data from Farside Investors.

ProShares Short Bitcoin Strategy ETF, $BITI, exceeded its previous record by a considerable margin, which is understandable given its status as a short Bitcoin ETF. Balchunas highlighted the potential launch of 2x and -2x spot BTC ETFs, amid strong demand from the traders.

Additionally, $BITO and $BITX both shattered their previous volume records, highlighting the unforeseen impact of the current enthusiasm for spot Bitcoin trading on futures-based ETFs.

The combined assets of the ten-spot BTC ETFs have surged past $50 billion, marking a significant milestone. Just seven weeks ago, these ETFs started with assets under $30 billion. Approximately $8 billion of the total increase is due to inflows, while the remaining growth is a result of the appreciation in Bitcoin’s price value. Eric Balchunas stated that both Bitcoin and ETFs are benefitting from each other.

Big moment for bitcoin but I'd argue just as big a moment for ETFs. Move from 25k to 69k was all or close to all due to ETF approval hopes and/or flows (as per Isabelle's chart) and arguably warranted IMO, ETFs (and its ecosystem) so damn good at taking something and making it… https://t.co/sfDDUudAtF

— Eric Balchunas (@EricBalchunas) March 5, 2024

BTC Profit Booking

While the Bitcoin ETFs continue to hit new milestones, there’s a strong profit booking from long-term Bitcoin holders, especially miners. Tuesday’s turbulent price fluctuations exemplified the unpredictable nature of Bitcoin, characterized by rapid surges and declines.

The optimistic speculations in the derivatives market further fueled the BTC uptrend, where investors could leverage their positions significantly, sometimes up to 100 times, using products like perpetual futures.

However, as Bitcoin’s trajectory shifted, over $800 million worth of bullish positions swiftly faced liquidation in the perpetual futures market, as reported by crypto data tracker Coinglass.