Bitcoin ETF Flows Surge in July

The U.S.-listed exchange-traded funds that closely track bitcoin's (BTC) spot price are back in demand. On Tuesday, the 11 funds recorded a cumulative net inflow of $422.5 million, the highest single-day tally since June 5, extending the seven-day winning run, according to data tracked by Farside Investors and Coinglass. BlackRock's IBIT amassed over $260 million on Tuesday, accounting for a giant share of the cumulative inflows. FBTC drew $61.1 million, while others, except GBTC, DEFI and BTCW, pulled in less than $30 million each.

These funds have collectively drawn in over $1 billion in just the last three days, underscoring investors' confidence in bitcoin's price prospects. BTC has surged 23% to $65,800 since hitting a low near $53,500 on July 5, CoinDesk data. In addition to the ETF inflows, the price recovery may be linked to the exhaustion of selling pressure from Germany's Saxony state, dramatic improvement in the probability of pro-crypto Republican candidate Donald Trump winning the U.S. presidential election on Nov. 4 and Trump's decision to appoint BTC-holder and Ohio Republican senator James David Vance as vice president.

Vance has supported BTC and digital assets since 2021 and began circulating a draft version of crypto legislation last month. "It is notable that Vance advanced crypto legislation at a moment when he knew he was being considered by Trump for VP. This highlights the new-found political relevance of crypto, but also the extent to which digital asset policy has become a part of the Republican vision for the US economy," FRNT Financial said in the newsletter Tuesday.

"Additionally, given that Trump can only serve another four years if elected, the VP decision was also seen as a choice on political succession. It is additionally encouraging for the crypto community that Trump’s seeming political successor is a BTC holder and has prioritized crypto-friendly legislation," FRNT added. It's also likely that with the supply overhang from Saxony behind us, the crypto market is catching up the sustained rally in technology stocks on Wall Street. Such is the optimism that reports of renewed creditor reimbursements from defunct exchange Mt. Gox on Tuesday failed to keep BTC prices under pressure for long.

New spot ETFs for Ethereum—which will let investors purchase the second most popular cryptocurrency in the form of stocks—are expected to begin trading on Tuesday, July 23. The Securities and Exchange Commission has green lit at least three funds to enter the market that day, sources told Reuters, although it’s believed that a total of eight Ethereum ETFs will launch simultaneously. The instruments follow in the footsteps of the eleven trading spot Bitcoin ETFs. Having accumulated over $54 billion in assets under management since launching in January, Bitcoin has soared 47% this year. Here’s all you need to know about their Ethereum counterparts.

Ether is the native cryptocurrency of the Ethereum blockchain. Despite the SEC’s reservations, Ether is legally considered to be a commodity, but the corresponding ETFs will be securities. ETFs first came to market in 1993. The funds pool together a basket of securities, such as a handful of different energy stocks, and the price aligns with the indexes that it tracks. They are listed on exchanges and can be traded during market hours, thus operating like stocks.

Spot Ether ETFs will track the spot—or current—price of Ether. The products give investors access to the underlying crypto without the need to own a crypto wallet. The ETFs will be set up as grantor trusts, meaning investors will own a share of the Ether held by the trust. Eight asset managers are proposing to offer Ethereum ETFs: BlackRock, Ark Invest/21Shares, VanEck, Grayscale, Fidelity, Bitwise, Franklin Templeton and Invesco/Galaxy Digital. Each instrument will be near-identical, so the fees charged to investors are competitive. For now, we know that Franklin Templeton will charge 0.19%, VanEck at 0.20%, and Invesco and Galaxy Digital will charge a 0.25% fee for its jointly filed ETF.

The full list of fees will be revealed when the final registration statements, or S-1s, are submitted to the SEC. This will be on Tuesday, if trading begins for all eight. They will be listed on the Nasdaq, Chicago Board Options Exchange (CBOE) and New York Stock Exchange. Bitcoin and Ether tokens represent units of ownership—and thus value—of an underlying blockchain. Beyond that, they are very different.

Whereas Bitcoin may be a long-term hedge against inflation, Ethereum is closer to a tech investment. The blockchain’s main premise is “to remove the intermediary and allow for 24/7 uptime in financial services, such as trading and lending, in addition to tokenization, digital collectibles, and digital identity,” Vetle Lunde, senior analyst at K33 Research, told Fortune. READ MORE BLOGS FROM OUR WEBSITE https://www.rapidinnovation.io/blogs

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