A senior executive of ProShares, a significant issuer of futures-based Bitcoin exchange-traded funds (ETF), stated that the company does not anticipate any threats to introducing spot Bitcoin ETFs in the United States rather sees benefits.
The introduction of spot Bitcoin ETFs will benefit ProShares’ futures products on both an operational and commercial level, according to an interview with ProShares’ global investment strategist Simeon Hyman on February 2.
Hyman stated that the ProShares Bitcoin Strategy ETF (BITO), the company’s primary Bitcoin futures ETF, has experienced “extremely efficient” trading volumes since the introduction of spot Bitcoin ETFs.
The executive stated, “We are quite pleased with the commercial impact thus far.” BITO trades from its underlying value at a discount of two basis points, or 2/100th of a percent. “However, spot ETFs have experienced an average discount or premium of 36 basis points,” he noted.
ProShares perceives operational advantages in addition to commercial benefits resulting from adopting spot Bitcoin ETFs, as the introduction of spot ETFs is anticipated to attract more participants to the Bitcoin market. Hyman stated,
“With the entrance of spot ETFs, the futures market is getting better, even better. It was already a well functioning and regulated place, but it’s actually gotten a little better when with the spot guys because there’s just more people around Bitcoin again.”
Hyman’s comments align to some extent with the trading patterns observed in BITO during recent weeks and months, except days with exceptionally high trading volumes around January 11, and these days occurred amidst the frenzy surrounding the introduction of spot Bitcoin ETFs.
On January 11, BITO experienced a significant surge in trading volumes, reaching nearly $2 billion. According to Yahoo Finance data, the company’s typical trading volumes had been approximately $300 million to $600 million.
Since the introduction of spot BTC ETFs, BITO has maintained its customary trading volume, which reached a minimum of $180 million on February 2. In the past, Yahoo Finance data indicates that BITO traded with a comparable volume of $120 million and $200 million on December 9, 2023, and November 30, 2023, respectively.
Significant spot Bitcoin ETFs, including iShares Bitcoin Trust (IBIT) by BlackRock and Grayscale Bitcoin Trust ETF (GBTC), flipped the trading volumes of BITO for the first time last week. Before that, BITO was the largest Bitcoin ETF globally in terms of trading volumes.
BITO, which debuted in October 2021, is the first substantial Bitcoin ETF focused on futures in the United States. In contrast to spot Bitcoin ETFs, which monitor physical Bitcoin holdings, the underlying asset of ProShares’ BITO is futures contracts.
