原文标题：Weekly: ETFs’ Record Debut
Authors: David Duong (Head of Institutional Research), David Han (Institutional Research Analyst)
发布日期：February 16, 2024
Summary: The U.S. spot Bitcoin ETF saw huge net inflows in the first month, with the total crypto market cap recovering to $2 trillion.
Quick facts about the highlights
- The U.S. spot Bitcoin ETF saw huge net inflows in the first month since its launch, totaling $3.3 billion.
- We believe that Bitcoin should remain well supported over the next 3-6 months as more institutional players invest their sights on this new ETF class.
- Ethereum's progress also coincides with the structural market changes that spot Ethereum ETFs may represent.
market
The U.S. spot Bitcoin ETF has seen huge net inflows in its first month since its launch, totaling $3.3 billion (over $4.2 billion year-to-date). This brings their total assets under management to approximately $36.8 billion. In contrast, the median expectation in our survey of institutional participants prior to ETF approval was close to $1 billion.
This momentum has helped the total crypto market capitalization return to March 2022 levels. We believe that Bitcoin in particular (and cryptocurrencies more broadly) should remain well supported over the next 3-6 months as more institutional players adapt to this new ETF category. At the same time, however, the global monetary re-inflation debate continues, which means that there were some negative seasonal factors that could disrupt this trend in March.
Looking at the broader ETF market, the net inflows of Bitcoin ETFs even surpassed those sucked in by State Street's SPDR Gold Shares ETF (GLD) in the first month, making it one of the most successful ETF offerings in history. GLD brought in $1.8 billion in inflation-adjusted dollars between October 18 and November 18, 2004. In fact, Bloomberg ranked BlackRock's iShares Bitcoin Trust (IBIT) and Fidelity's Wise Origin Bitcoin Fund (FBTC) as "the top 0.1% of the approximately 5,500 new ETF offerings over the past 30 years." ”
While rebalancing liquidity (flows from some funds to others) has begun to stabilize, there are still some sources of technical selling pressure. On February 14, Genesis Global Holdco LLC received permission from the U.S. Bankruptcy Court for the Southern District of New York to repay creditors based on the following items it holds:
- 35.9M shares of Grayscale Bitcoin Trust (GBTC) ($1.66 billion as of February 15).
- 8.7 million shares (approximately $209 million) of Grayscale Ethereum Trust (ETHE).
- Grayscale Ethereum Classic Trust （ETCG） 的 300 万股（约 3800 万美元）。
The ruling allows Genesis to (1) convert shares in these funds into BTC, ETH, or ETC on behalf of creditors (e.g., by selling GBTC and buying BTC), or (2) sell shares outright and distribute cash. Also note that the confirmation hearing for the Genesis Chapter 11 bankruptcy plan is scheduled for February 26 (9:30 a.m. ET), at which time the court will approve, reject, or postpone the decision on the debt repayment plan. It's unclear that if not directly used to buy Bitcoin to repay creditors, then the additional GBTC outflows will go into other US spot Bitcoin ETFs. Our view is that the majority of these funds are likely to remain in the crypto ecosystem, resulting in a neutral overall impact on the market.
A gratifying performance of the Ethereum ecosystem
Meanwhile, open interest in CME Bitcoin and Ether futures has recovered over the past six sessions, with the former hitting an all-time high of $6.3 billion (see Chart 1). Given the recent strong performance of cryptocurrencies, and the CME Bitcoin futures basis trade close to 16% (30-day annualized), the resurgence in institutional interest is not surprising. That said, we believe that given a series of significant catalysts that are likely to occur on Ethereum in the coming months, including the possible approval of spot ETFs in the US, as discussed in our recent monthly outlook, we believe there will be room for ETH's open interest to increase relative to Bitcoin.
Recently, Franklin Templeton also applied for a spot Ethereum ETF (the eighth applicant), and Ark 21Shares modified their application to allow staking. Given the strong inflows into spot Bitcoin ETFs, we expect more issuers to turn their attention to the second-largest cryptocurrency in the coming months. Market participants are watching to see if the SEC is starting to actively participate in issuers' filings, as this could affect their expected chances of being approved.
Ethereum's technological advances also coincide with the structural market changes that spot Ethereum ETFs may represent. First, most of the risks for Geth clients have been largely mitigated, with updated monitoring showing that less than 50% of clients are currently running the software, down from the previous absolute percentage of 85%. This rapid shift comes after Ethereum's Besu and Nethermind clients went down in early January and raised concerns about the risks of Geth centralization. The diversity of Ethereum clients underpins its stability and proves the maturity of the network compared to other smart contract platforms.
Other technical improvements continue to be made to the network, albeit with some delays. The Dencun upgrade (originally expected in Q4'23) is now scheduled for March 13, 2024. We believe that the successful upgrade and adoption of Proto-Danksharding will introduce blob storage and help further strengthen the viability of Ethereum's long-term roadmap for Rollup scalability. As more and more data availability solutions, such as Celestia and EigenDA, also offer alternative solutions for Rolup data publishing, we believe that the cost of Rollup could be reduced by an order of magnitude by 2024.
Finally, we believe that Ethereum's role as a reward-generating proof-of-stake asset will become increasingly important. Ethereum continues to exhibit net deflation due to its EIP-1559 burning mechanism, with an annualized deflation rate of 0.5% over the past seven days, and the total supply has decreased by 0.3% since The Merge. At the same time, validators have staked about 25% of Ethereum's total supply (about 30 million ETH), which is in line with what we expected when we released it a year ago. That's more than double the amount staked during the September 2022 Merge.
Re-staking
In our view, staking-centric protocols, and more recently re-staking, are poised for a "DeFi renaissance" centered around real yields. EigenLayer, the main restaking project on Ethereum, which is able to repledge staked Ethereum to secure other services, increased its total value locked (TVL) from $1.1 billion to $4.3 billion after the deposit cap was temporarily removed. This exceeds Uniswap and Compound's total TVL across all chains and is approaching Aave and Maker.
Interest in re-staking protocols may be the driving force behind the recent increase in staking ETH, which is partly reflected in the entry of validators into the queue that has not been emptied since the end of January (see Figure 2).
Please note that EigenLayer has not yet launched any Active Authentication Service (AVS) on mainnet. Tier-2 protocols built on top of EigenLayer, tokens that provide liquidity for re-staking or various other on-chain products, have also witnessed tremendous TVL growth. We believe that a yield-luring restaking ecosystem could be an anchor for Ethereum's undervalued liquidity. Although EigenLayer's mainnet launch date has not yet been confirmed, the expectation of a Q2 2024 launch may coincide with the deadline for Ethereum ETF approval, which could be late May, which will also increase market interest in Ethereum.
Crypto and the performance of the traditional sector
As of February 15 at 4 p.m. ET
Coinbase Exchange & CES Insights
Prices continue to move higher this week. The lack of large-scale liquidation indicates that there are no over-leveraged short positions in the market, and this liquidity dynamics are broadly in line with customer sentiment. It's hard to find anyone who is bearish. Crypto-native funds continue to push altcoins higher, while more traditional market participants have increased their BTC positions. While ETH has performed well this week, the token's liquidity remains balanced.
Coinbase Platform Trading Volume (USD)
Trading volume on the Coinbase platform by asset
Funding rate
Notable Crypto news
institution
- Genesis Receives Approval to Sell $1.3 Billion in GBTC (Bloomberg)
- Since its launch, net inflows into Bitcoin spot ETFs have totaled more than $4 billion, according to Coinshares analysts (The Block)
- Bitcoin ETFs absorb 10 times more BTC than miners produce (Cointelegraph)
Supervision
- Binance Founder Changpeng Zhao's Verdict Postponed to April (The Block)
synthesis
- Starknet 基金会向近 130 万个符合条件的钱包公布了 STRK 代币分配计划 （The Block）
Coinbase
- California Voters Support Crypto (Coinbase Blog)
Global perspective
Europe
Deutsche Börse-owned Crypto Finance has received four licenses from the German Federal Financial Supervisory Authority, which strengthens its ability to provide regulated digital asset services in Germany, as Deutsche Börse plans to introduce an institutional-grade cryptocurrency exchange. (CoinTelegraph)
Deutsche Börse's Crypto Finance has received four licenses from the Federal Financial Regulatory Authority, which strengthens its ability to provide regulated digital asset services in Germany, as Deutsche Börse plans to introduce institutional cryptocurrency exchanges. （CoinTelegraph）
Telefónica has partnered with Chainlink Labs to leverage web3 technology to enhance security measures against SIM card fraud, leveraging the SIM SWAP API to provide additional protection for blockchain transactions. （The Block）
Asia
The Ethiopian government has partnered with a Hong Kong-based data center operator to engage in Bitcoin mining as part of a $250 million plan to create advanced infrastructure for data mining and AI training in Ethiopia. （CoinTelegraph）
Japan's financial regulator has proposed a measure to banks aimed at strengthening protections against fraudulent transactions involving cryptoassets. （CoinTelegraph）
South Korean game publisher Com2uS is partnering with the Oasys blockchain to develop web3 games and expand into the Japanese market, with plans to launch franchises for popular games like Summoners War: Chronicle on the blockchain network. (Block)
South Korea's Financial Intelligence Unit (FIU) will step up oversight of cryptocurrency exchanges, aiming to remove those deemed non-compliant from the market starting in 2024. （CoinTelegraph)
Big events of the week ahead