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New Hong Kong Bitcoin ETFs Disappoints Speculators With Low Demand

Bitcoin ETF sees less than 5% of expected demand in failed launch.

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  • The spot bitcoin and ether ETFs recently listed in Hong Kong saw trading volume of a little more than $6.3 million, as per HKEX data.

  • This is drastically less compared to the 11 spot bitcoin ETFs that started trading in the U.S. in January, which had a daily turnover of around $4.6 billion on their first day.

On their first trading day today, these ETFs collectively generated a trading volume of approximately HK$49.4 million ($6.3 million), as per data from the Hong Kong Stock Exchange. This amount is much less than originally anticipated, with many speculators and analysts predicting over $125M+ in first day inflows, which has shown to be a major miss.

Harvest saw $8.11 million in trading volume for its spot bitcoin ETF and $2.18 million for ether. Meanwhile, Bosera HashKey Bitcoin ETF recorded $3.59 million in volume, with its ether ETF’s volume at $1.53 million during the morning session.

Notably, when the U.S. witnessed the trading debut of 11 spot bitcoin ETFs in January, their first-day volume reached a staggering $4.8 billion.

Additionally, China Asset Management disclosed that its subscription size during the initial offering period amounted to about $1.1 billion. The bitcoin product attracted $950 million in subscriptions, while the ether ETF brought in $160 million, as initially reported by WhaleWire. This amount has been confirmed by China Asset Management with The Block.

These ETFs were greatly anticipated by the Bitcoin community, as they believed it would stimulate hundreds of millions or even billions in new demand into the crypto markets. However, the data coming out doesn’t support this expectation.

In a tweet from yesterday, we predicted that the ETF launch would be a failure in all regards. It was indeed a failure, but the most important thing investors need to realize is how the demand for Bitcoin, especially from institutions, is on a downward trend. Right now, it’s evident we have a lot of fluff and hopium clouding people’s judgments.

While the low demand is a huge shock to many Bitcoiners, what is really shocking is the massive expectations that many had for this, despite reality showing the complete opposite.

Each of these Bitcoin ETFs launched has an average of less than $1.8 million in volume, which is not only embarrassingly low but also a huge red flag. With all data points considered, this ranks as one of the worst-performing day 1 Crypto ETF launch to date.

Bitcoin bull run experiencing a “short-term pause”

Analysts from brokerage firm Bernstein assert that the recent slowdown in inflows to spot Bitcoin ETFs isn't indicative of a long-term downturn but rather a temporary pause before the cryptocurrency's upward momentum resumes.

In a statement addressed to their clientele, analysts Gautam Chhugani and Mahika Sapra of Bernstein said,

"We view the deceleration in Bitcoin ETF activity not as a cause for concern, but rather as a momentary hiatus preceding a period where ETFs become more integrated within private banking platforms, wealth management advisories, and an expanded array of brokerage services."

Highlighting their ambitious projection of a $150,000 Bitcoin valuation by the close of 2025, the analysts attribute this optimism to the "unprecedented demand for ETFs," which has resulted in a staggering $12 billion in net inflows since their introduction to the market on January 11.

Meanwhile, a recent publication by Ecoinometrics urges readers to remain vigilant for potential shifts in financial dynamics that could either propel or hinder Bitcoin's ongoing bull run.

The report warns that despite the influx of investment through spot Bitcoin ETFs, broader economic factors and the Federal Reserve's struggle to contain inflation could pose challenges to the cryptocurrency's upward trajectory.

"This could trigger a reevaluation of financial conditions, potentially posing obstacles to the prevailing bull market."

In contrast to the aforementioned analysis, I hold an opposing view and contend that these two financial analysts may be misinterpreting market dynamics.

Their notably bullish long-term forecasts, reaching upwards of $150,000 as soon as next year, seem to overlook mounting evidence indicating an impending global economic downturn, including within crypto. While it is good that they acknowledge a temporary pause in the current trajectory, I maintain that this slowdown extends beyond the short term and encompasses broader, long-term implications.

Bitcoin Lack of Demand Spreading Across USA

It symbolizes that the Asian markets are simply not interested in buying, but this trend isn’t just for them. We can see in the US Markets, the Bitcoin ETFs are facing extreme challenges.

Dozens of Spot bitcoin exchange-traded funds in the United States are seeing record-breaking outflows. Just yesterday, we saw more than $51.5 million sell.

Notably, the Grayscale Bitcoin BTC +1.88% Trust was not the biggest culprit. The ARK 21Shares Bitcoin ETF saw $31.34 million leave the product on April 29, while GBTC experienced $24.66 million in net outflows, per data from SoSoValue. The Fidelity Wise Origin Bitcoin Fund also saw a net outflow of $6.85 million.

For the last year, investors were pushed this idea by the media and banks that institutions are coming to save everyone and buy their bags up high. In reality, this was nothing more than Tether and their shady cartel of crypto exchanges rigging the prices under the guise of institutional demand.

Tether printing has been growing at its fastest pace in years. With more lawsuits growing and incoming regulations, it’s simply a ticking time bomb, and all real metrics from these ETFs paint an entirely different picture.

Bitcoin Drops in Reaction to News

The price of Bitcoin has slid today with this news, plunging from nearly $65,000 to just above $60,000, which isn’t expected to hold for long.

As we’ve discussed in many articles and posts, we believe the price is still extremely overvalued, and as mentioned, is being artificially held up by the crypto cartel. Real volume right now is dangerously low, and once the music stops, we predict a return to reality and a major collapse in price.

We have another article coming shortly that will discuss more about the price prediction for 2024 and 2025. We’ve hired a new batch of people, including 17 new market analysts on our WhaleWire team, who have an amazing track record in the financial markets, which we aim to share their insights with you all in our premium newsletter, for those subscribed.

Share Your Thoughts

As always, our goal with this newsletter isn't to criticize Bitcoin or encourage people to sell; instead, it's to provide education and a contrarian perspective.

This news often goes unnoticed, and you'll rarely find other crypto news sources discussing data like this. We aim to be the contrarian voice that informs you about the good, bad, and ugly aspects to help you make informed investment decisions.

We would also love to hear your thoughts on the failure of this HK Bitcoin ETF launch. Do you think it’s too early, and things will reverse? Let us know!

Stay informed, and stay tuned for more updates from WhaleWire!

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