After successful trading on the first day of Bitcoin Spot ETFs in Hong Kong, renowned Bloomberg Intelligence expert Eric Balchunas took center stage to analyze the historical introduction of the products into the country.
Hong Kong Bitcoin Spot ETFs attract notable inflows
Tuesday, Eric Balchunas called Hong Kong Spotting Bitcoin ETFs a market for ants, as it is only 1/168th the size of funds in the United States. He further pointed out that the launch of Hong Kong spot ETFs coincided well with the US slowdown, so their inflows will more than offset slightly negative flows in the US.
Given the notable inflows observed on the first day, the Human and Machine channel challenged the analyst by pointing out that after raising more than 11.2 million Hong Kong dollars on its first day of activity, the channel Hong Kong Bitcoin and Ethereum Spot ETFs countered net outflows from the US market.
In response to the channel’s post, Balchunas said that he and his team recently released a note containing final data for Hong Kong spot ETFs, which is not as timely as in the United States. According to the expert, he had previously predicted that these products would generate an inflow of 1 billion dollars in two years. However, with Hong Kong recording assets of $292 million on day one, he believes his forecasts could be well ahead of schedule and corrections could derail plans, as seen in the US market .
During the first day of trading, Ethereum Spot ETF occupied 15% of the market and investors seemed to be attracted by larger funds rather than lower fees. Spot ETF ChinaAMC BTC (3042 HK) with higher fees saw the highest inflow valued at $124 million on the first day. Meanwhile, other funds with lower fees like the Harvest Bitcoin Spot ETF (3439 HK) and Bosera Hashkey Bitcoin ETF (3008 HK) saw a net inflow of $63 million and $61 million respectively first day.
Eric Balchunas’ focus appears to have fueled confusion among community members, as a pseudonymous X user questioned the analyst about the difference between the $292 million in assets and the $11.2 million of Hong Kong entries.
Balchunas responded by saying that the exact $292 million in assets that were brought in as seed capital just before launch are not included in the volume calculation. Meanwhile, in the United States, seed money is held back until day one to make the volume appear larger, making it easier to market.
The fund experiences massive outflows in the United States
The Bloomberg expert’s analysis comes in light of the massive capital outflows observed in the American market, exceeding $500 million in one day. Investors saw the fastest ever sell-off of US BTC spot ETFs on Wednesday, recording a cumulative net outflow of $563.7 million.
According to data from Farside Investors, this is the biggest outflow since the funds began trading earlier this year. Among the 10 Spot Bitcoin ETFs, the Fidelity Wise Origin Bitcoin Fund (FBTC) saw the largest withdrawals, totaling $191.1 million.
The Grayscale Bitcoin Trust ETF (GBTC) saw withdrawals of around $167.4 million, while black rock iShares Bitcoin Trust (IBIT) saw a huge withdrawal of $36.9 million, marking its first day of outflows since its inception.
Featured image from iStock, chart from Tradingview.com
