Data shows the ProShares Bitcoin ETF has reached a milestone number of assets under management (AUM), and has breathed fresh life into CME in the process.
ProShares Bitcoin ETF AUM Sets New All-Time High Of 26.7k BTC
As per the latest weekly report from Arcane Research, the ProShares BITO ETF has set a new all-time high of around 26.7k BTC for its AUM this week.
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An “exchange traded fund” (or ETF in short) is a type of investment vehicle that tracks the price of another asset or commodity.
With the help of an ETF, users can bet on the price of an asset without actually owning said asset themselves. There may be a couple of reasons why an investor would prefer to invest this way rather than just buying Bitcoin.
First is that some investors may not be well versed with the workings of the crypto world, and would rather not have to navigate around exchanges and wallets. ETFs, on the other hand, would be much more familiar territory for many.
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The second reason is the ability to bet on the price in either direction. In a spot investment, investors can only earn profit when the price of Bitcoin moves up.
Now, here is a chart that shows the trend in the ProShares BITO AUM, the Bitcoin ETF that got the first approval:
Looks like the ETF's AUM has reached a new all-time high | Source: The Arcane Research Weekly Update - Week 6
As you can see in the above graph, the Bitcoin denominated under the fund started falling off in December as the price of the crypto also dwindled.
However, after hitting a bottom in the middle of January, the ETF’s AUM has picked up some upwards momentum.
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Now this week, the indicator has set a new all-time high. The ETF has added exposure to the March futures on CME, and the recent strong inflows may have also impacted the front-month premiums. This has breathed a new life into the derivatives exchange’s growth.
At the time of writing, Bitcoin’s price floats around $42.6k, down 3% in the last seven days. Over the past month, the crypto has lost 1% in value.
The below chart shows the trend in the price of BTC over the last five days.
BTC's price seems to have dropped off over the past twenty-four hours | Source: BTCUSD on TradingView
The price of Bitcoin had once again surged up above $44k a couple of days ago, but today the value has slipped back down below the $43k level.
Featured image from Unsplash.com, charts from TradingView.com, CryptoQuant.com