On August 5, the United States Bitcoin and Ethereum ETFs recorded nearly $6 billion in trading volume amid significant market turmoil. The spike in activity came as Bitcoin’s price dropped below $50,000 at the start of US trading.
According to data from CoinGlass, spot Bitcoin ETFs registered a total daily volume of $5.24 billion, with more than half of this volume coming from BlackRock’s iShares Bitcoin Trust (IBIT). Meanwhile, spot Ethereum ETFs recorded $715.3 million in trading volume, led by Grayscale’s Ethereum Trust (ETHE) and BlackRock’s iShares Ethereum Trust (ETHA). The combined volume for Bitcoin and Ethereum ETFs amounted to $5.96 billion.
Bloomberg ETF analyst Eric Balchunas highlighted the surge in trading volume on social media, noting that “crazy volume” during a market rout is typically a “pretty reliable measure of fear.” However, he also pointed out that deep liquidity on volatile days is one of the attractive features of ETFs for traders and institutions, suggesting that high trading volumes are beneficial in the long term.
The crypto markets began to decline on August 4, triggered by news of Jump Trading moving substantial amounts of Ether to exchanges. The price drop intensified on August 5, coinciding with significant declines in the Nikkei index and a reversal in the Japanese yen carry trade, causing Bitcoin to briefly fall below $50,000 during US trading hours.
Despite the initial plunge, Bitcoin has since recovered slightly, trading above $54,200. Preliminary inflow data from CoinGlass shows mixed results across Bitcoin and Ethereum ETFs. The Grayscale Bitcoin Trust and ARK 21Shares Bitcoin ETF (ARKB) each reported outflows of $69 million, while the Bitwise Bitcoin ETF (BITB) and the Grayscale Bitcoin Mini Trust (BTC) saw inflows of $2.9 million and $21.8 million, respectively.
For Ethereum ETFs, the Grayscale Ethereum Trust experienced outflows of $46.8 million, while Bitwise and Franklin Templeton’s ETFs recorded inflows of $7.2 million and $900,000, respectively. Bloomberg ETF analyst James Seyffart predicts that Bitcoin ETFs will ultimately end up with a net inflow once all data is finalized.
This significant movement in crypto ETF volumes underscores the volatility and rapid response of the market to external events, reflecting both the challenges and opportunities present in the crypto trading landscape.