Zinger Key Points
- Bitcoin ETFs post stellar yearly returns but face short-term volatility amid macroeconomic and market pressures.
- Investors eye Trump-era crypto policy changes as Bitcoin ETFs navigate a challenging yet optimistic second year.
As Bitcoin BTC/USD ETFs approach their first anniversary of trading on U.S. exchanges, the journey so far has been as volatile as the crypto market itself.
From their explosive debut in January 2024 to recent market fluctuations, these funds have kept investors guessing.
Bitcoin ETFs’ Turbocharged Debut
The Grayscale Bitcoin Trust GBTC and iShares Bitcoin Trust IBIT were among the first Bitcoin ETFs to hit U.S. exchanges on Jan. 11, 2024. On their inaugural day, tens of millions of shares changed hands, with combined trading volumes soaring into the billions.
Despite the buzz, the funds showcased Bitcoin's infamous volatility. GBTC closed up a modest 0.5%, while IBIT fell over 4% after an early rally on debut day.
A Year Later: Mixed Signals
Fast forward to today, and both ETFs have posted jaw-dropping annual returns—GBTC up 90.97% and IBIT up 100.30%—yet their short-term movements tell a different story.
Chart created using Benzinga Pro
- Grayscale Bitcoin Trust (GBTC): Trading at $74.48, GBTC is below its eight-day simple moving average, signaling short-term bearishness. However, long-term indicators like its 20-day, 50-day and 200-day SMAs, all suggest bullish momentum driving the ETF.
- iShares Bitcoin Trust (IBIT): At $53.34, IBIT mirrors GBTC's pattern— with its short-term signal being bearish, but a bullish outlook on longer-term averages.
Chart created using Benzinga Pro
The funds' trends are "moderately bearish," with slight selling pressure, reflecting broader uncertainty in the crypto market.
Bitcoin's Rocky Road
The performance of these ETFs isn't happening in a vacuum. Bitcoin itself has seen a recent pullback after its strong 2024 rally, with Unity Wallet COO James Toledano offering key insights:
"Bitcoin's sudden decline likely reflects a combination of macroeconomic and market-specific pressures. Concerns over slower-than-anticipated Fed rate cuts and robust U.S. economic data are weighing on speculative assets," Toledano said in an emailed statement.
He also pointed to profit-taking following Bitcoin's 2024 surge, largely fueled by optimism surrounding Donald Trump's pro-crypto stance.
"Now everyone is holding their breath for Trump's inauguration on Jan. 20. The expectation is that crypto will surge again—this is very much the downturn before the storm," Toledano added.
The Road Ahead
As Bitcoin ETFs enter their second year, investor focus will likely shift to policy changes and market dynamics under Trump's administration. With Bitcoin's volatility showing no signs of fading, these ETFs remain a high-stakes bet for risk-tolerant traders.
From day one fireworks to today's mixed signals, Bitcoin ETFs have proven one thing: they're not for the faint of heart.
Will 2025 bring more bullish momentum, or is this just the calm before the next crypto storm? Investors will find out soon enough.
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