New Hong Kong Bitcoin ETFs Disappoints Speculators With Low Demand

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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.