Fueled By Recent Bitcoin Bull Run, ETP Volumes Surge Above 50%
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Bitcoin has performed incredibly well in the last 30 days. The digital asset has risen from around $11,000 as of October 18, 2020, to a new 2020 high of over $18,450 within a month. Data, however, reveals that Bitcoin is not alone in this rally. Several crypto exchange-traded products, or ETPs - particularly institutional-grade ETPs, have also surged in market cap and volumes as key players jostle to get in on the action.

In a recent "Digital Asset Management Review" by CryptoCompare, the crypto market data provider explored some of the metrics behind Bitcoin’s recent bull run. One key takeaway from the research is that institutions have been a major driver of this momentum.

The report disclosed that aggregate ETP volumes have surged 53% in the last 30 days. Average daily volumes, which stood at $113 million in October, are now over $173 million, with several products demonstrating above-market returns.

For insight, an exchange-traded product (ETP) is a type of security that tracks underlying securities, indexes or other financial instruments. The price of an ETP is typically derived from the underlying investment it tracks, which in this case is Bitcoin.

According to the report, Grayscale’s Bitcoin Trust Product (GBTC) is one of the major players driving momentum. With $9.1 billion in assets under the firm’s management, it represents the highest market cap of all ETP products in the market – an increase of 56% in the last 30 days. The OTC-traded product also recorded $215 million in weekly inflows, seeing its product volume surging 68% on average to $162 million in November.

Meanwhile, Grayscale’s Ethereum Trust product (ETHE) saw an increase of over 40% within the month, with assets under its management rising to $1.7 billion.

Apart from Grayscale, the report revealed that 3iQ’s Bitcoin Fund (QBTC) recorded its highest returns at just over 49% in the last 30 days. The Canadian investment fund manager, which traded predominantly on the Toronto Stock Exchange, saw its market cap stand at $167 million. This is a difference of $62 million from October.

And while ETC Group’s BTCE product recorded the largest percentage increase in assets under management from the previous 30 days, WisdomTree’s BTCW experienced a 65% increase to $79 million, within the same period. Sitting at $116 million, the market cap of BTCE nearly doubled; a surge of 93% from October. Moreover, the average volumes for the BTCE product tripled in November to $8.87 million per day.

The interesting thing about the BTCE fund is that despite being launched in June 2020, it has gained a lot of momentum and is the first Bitcoin-based ETP to list on Xetra, a trading technology platform.

Speaking of institutional-grade products and cryptocurrency investment options, Liber Ltd has created a convenient way to invest in digital assets. The company is authorized and regulated by Belize Securities and Exchange Commission and operates in the financial trading area with enrollment number 174775.

Liber Ltd is offering its services in the biggest financial market in the world – the Forex market. Its blockchain project combines a number of proprietary techs, including AI, Big Data and Blockchain in creating a forex trading floor. Using a native currency, LIBFX token, the company hopes to provide a decentralized, low-cost, transparent and secure trading experience.

In addition to receiving monthly profits from holding the LIBFX token, owners also have exclusive rights to purchase Liber Ltd’s stock when it becomes listed on the stock exchange floor.

Between 2020 and 2022, Liber Ltd has plans to diversify its product offering to include index, stock, cryptocurrency, cargo, metal and energy, bond and DMA. The bottom line is that institutional-grade products are playing a critical role in Bitcoin’s positive price actions in 2020. Furthermore, a combination of factors such as financial uncertainty, comments from central banks, institutional investment and adoption as a means of payment are emboldening investors.

More and more people are seeking out investment options in the crypto space. But online the rally of 2017, the cryptocurrency space is more matured and is expected to garner more retail and institutional investors.

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