BITO Debuts on the NYSE, and Bitcoin Reaches All-Time High
- Bitcoin’s price surged to an all-time high of $66,974 on Wednesday, October 20, 2021.
- BITO, the first Bitcoin futures ETF, debuted on the NYSE on Tuesday, October 19, 2021.
- BITO traded $1 Billion in assets in two days, surpassing the ETF GLD, which reached $1 Billion in three days.
As of Thursday, October 21, 2021, the price of Bitcoin was $62,550. On Wednesday, October 20, 2021, Bitcoin prices reached a record high of nearly $67,000. Many speculate the price increase was due to Bitcoin’s futures ETF, BITO, debuting on the New York Stock Exchange. The Bitcoin futures ETF is accessible to investors on the NYSE ARCA exchange.
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What is BITO?
BITO is a Proshares Bitcoin Strategies ETF. The Exchange Traded Fund is not linked to bitcoin prices directly. Instead, it provides exposure to investors who may not want to invest in bitcoin directly. BITO tracks Bitcoin prices through the purchase of Bitcoin futures which are then securitized by the fund.
BITO is traded on the New York Stock Exchange, similarly to any other stock or exchange-traded fund. This allows retail investors to have access to BITO and trade the ETF easily through various brokerage accounts.
The BITO ETF debuted when Wall Street opened on Tuesday, October 19, 2021, and began trading at a price point of nearly $41.00. The Proshares ETF peaked at $43.28 per share before dropping down to around $39.00 on Friday. As of Friday, October 22, 2021, the ticker BITO was priced at $39.62 per share.
In just the first two days of trading, the Bitcoin ETF broke records when reaching a trading volume of $1.2 Billion. BITO is the fastest ETF to reach the 1 billion dollar mark, surpassing the ETF GLD, which reached $1 billion in three days.
Despite such high trading volume, it is essential to note that BITO is not guaranteed to track the price of Bitcoin, as BITO is not linked directly to Bitcoin. Therefore, traders who prefer to invest in Bitcoin directly may purchase Bitcoin through crypto-supported apps instead.
Recommended Read: From Bitcoin to Blockchain. What Exactly is Cryptocurrency?
Bitcoin Reaches Record High
Bitcoin, the largest cryptocurrency in the world, reached an all-time high last week. With a market capitalization of over $1 trillion, Bitcoin reached a price of over $66,974 on Wednesday. However, as of Friday, October 22, 2021, the price of Bitcoin dropped to around $60,000. Due to Bitcoin’s high volatility, the cryptocurrency’s recent price fluctuations are unsurprising.
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Bitcoin bulls are hopeful and expect to see Bitcoin prices continue to soar. In addition, as more institutions on Wall Street are showing interest in Bitcoin investments, additional Bitcoin ETFs are expected to debut.
According to the Financial Times, Grayscale Investments announced they would be converting its $40 billion Bitcoin Trust into an ETF. This ETF will be backed by digital tokens, which Grayscale Investments will own outright.
Investing in Bitcoin
As an investor, adding Bitcoin to your portfolio may be an investment to consider. However, before investing in any type of cryptocurrency, including Bitcoin, it is crucial to understand what the investment means for you and your money.
As of January 2021, there are reportedly more than 4,000 cryptocurrencies in existence. However, Bitcoin is the most popular cryptocurrency, despite its high volatility rate. When Bitcoin first launched in 2009, the virtual currency was only worth $0.0008.
The use of digital currencies such as Bitcoin cuts out the need to deal with a financial institution or intermediary. In today’s economy, some cryptocurrencies are also accepted at businesses to purchase goods and services. For example, Twitter recently announced they would be allowing their users to tip their favorite content creators with Bitcoin. The advantages of the popular cryptocurrency have also led El Salvador to adopt Bitcoin as an official currency.
Due to the high volatility of Bitcoin and other cryptocurrencies, investors interested in crypto should consult a certified financial advisor to ensure investing in cryptocurrency is the right choice for their investment portfolio.
Have you added cryptocurrency to your list of investments? Comment your thoughts on the volatile investment below.
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