Last few years have seen a number of innovative crypto trading products enter the digital market. Traders and investors now have a much bigger choice, when it comes to putting their money to work in digital assets. One such investing instrument is an ETP — Exchange-Traded Product. Back in 2018, Swiss Fintech startup Amun AG launched the first crypto ETP. Since then the company has launched many more ETPs in the crypto space — most recent one being an inverse ETP, launched earlier this year.
For those of you, who are not familiar with ETP, it is an Exchange-Traded Product bearing a close resemblance to an ETF (Exchange-Traded Fund). Both of them are traded on stock exchanges like common shares, where the price is determined by the performance of the underlying asset or index. However, ETFs have minimum diversification requirements & the fund is only allowed to be invested in certain categories of the underlying asset.
According to the Digital Asset Management Review performed by real-time crypto data company CryptoCompare, it shows that ETP Volumes spiked 53% as a result of the massive surge in Bitcoin (BTC) price that we have seen in the past four weeks. BTC is trading just shy of $18k at the time of writing. Considering that BTC holds almost two-thirds (65.8%) of the market cap of the total crypto market, it isn’t a surprise that any move in the premier digital asset inadvertently affects the broader crypto market.
Before moving on to some of the insightful charts, lets quickly review the key takeaways from the research:
? November ETP volumes have increased 53.5% to $173.5 million/day.
? Grayscale’s Bitcoin Trust Product (GBTC) which currently represents the highest market cap of all ETP products surged to $9.1 billion.
? ETC Group’s BTCE product saw the biggest rise in market cap doubling to $116 million(+93%), while BTCW by WisdomTree posted a 65% increase to $79 million.
? Canada’s first public Bitcoin fund, 3iQ’s Bitcoin Fund (QBTC), surpassed the $100 million mark in October and now stands at $167 million.
? ETC Group’s BTCE saw average volumes triple in November to $8.87 million/day (+212%).
? 3iQ’s Bitcoin Fund (QBTC-U) experienced the highest 30-day returns at 49.1%, followed by WisdomTree’s BTCW (+39.1%) and Grayscale’s GBTC (+38.4%).
? On the flip side. Grayscale’s Digital Large Cap Fund (GDLC) experienced a 30-day loss of 20.6%.
Market Cap of the Top ETPs
The relentless bull run in Bitcoin has caused substantial increases in both trading volumes and market cap of the ETPs. Just like BTC dominates the general crypto market, Grayscale Bitcoin Trust Product (GBTC)Bitcoin Trust Product (GBTC) dominates the ETP market (top chart, Figure 1) — having the highest market cap of all ETP products at $9.1 billion and posting an increase of 56% to the 30-days prior. It also set a record of $215 million in weekly inflows over the last month. Their second most popular ETP was the Ethereum Trust product (ETHE) valued at $1.7 billion and increased 40% in market cap for the same period.
Excluding Grayscale’s OTC-traded products, the largest ETP by market cap is currently 3iQ’s Bitcoin Fund product (QBTC) — Canadian based ETP which is primarily traded on the Toronto Stock Exchange and surpassed $100 million in October, and now stands at $167 million (58 % increase in 30-days). ETC Group’s BTCE almost doubled (+93%) to $116 million followed by BTCW by WisdomTree — growing to $79 million with a 65% increase.
ETP Trading Volumes: Aggregate & Individual
As evident from the charts above (Figure 2), ETP volumes to started to soar in the middle of October — coinciding with the massive price boom seen in Bitcoin. Volumes in individual ETPs and the aggregated volume (top chart) all reflect the spike seen in the last 30 days. GBTC volume has increased 68% on average to $162 million in November so far, followed by ETHE which has increased by 42% to $10.9 million/day.
Other non-OTC products (bottom chart above) has also seen a significant boom in volume in November. BTCE tripled its volume to $8.87 million/day (up 212%), while 3iQ’s QBTC-U volume soared by 52.8% to reach $2.29 million/day.
30-day Price Performance of Top ETPs
Of the Grayscale products, all of them posted handsome gains with the exception GDLC (Figure 3, top chart), which experienced a 30-day loss of 20.6%. Excluding Grayscale, the research calculated that five ETP products (GBTC, BTCE, QBTC-U, BTCW, ABTC) outperformed the MVDA index — a market-cap-weighted index that tracks the performance of a basket of the 100 largest digital assets (Figure 3, bottom chart).
Data so far for the digital assets suggests that Christmas has arrived early this year.
Originally Published on Medium
Medium ??| Twitter ?? | LinkedIn ??| StockTwits ?? | Telegram ??
