Bitcoin ETF Analysis: Over Half of Investments Linked to Arbitrage

user avatar

by Giorgi Kostiuk

2 years ago

Since the launch of Bitcoin ETFs in the US in January 2024, there has been significant interest in these financial products, with most investments linked to short-term arbitrage strategies.

Arbitrage Strategies Dominate Bitcoin ETF Inflows

According to 10x Research, only 44% of the $38.6 billion invested in Bitcoin ETFs are real long-term investments. The remaining 56% is associated with arbitrage strategies, particularly the carry trade, where traders buy Bitcoin through ETFs and sell futures. This allows them to profit from the price difference between spot and futures markets.

Declining Arbitrage Appeal Triggers Outflows

The narrowing of funding rates and basis spreads has made arbitrage less appealing, leading to reduced inflows into Bitcoin ETFs and significant outflows recorded in the past month. Despite this, the spot price of Bitcoin has remained stable.

Changing Market Dynamics Post-Election

Following the US elections, there has been an increase in genuine Bitcoin buying activity. However, plummeting funding rates and declining retail trading volumes continue to challenge the market. Meanwhile, interest from traditional financial institutions in Bitcoin ETFs remains evident.

Research indicates that despite the large volume of Bitcoin ETFs, the share of long-term investments is limited, highlighting the significance of arbitrage strategies in the current market.

Tier I

Sector: #18291

Sealed Hiding Place Room

Resource Cache

Resource Cache

Tier I

Requires 25% Tier Progress to Claim
Meme Cache

Meme Cache

Tier I

Requires 50% Tier Progress to Claim
Equipment Cache

Equipment Cache

Tier I

Requires 75% Tier Progress to Claim

After collecting, hiding places will be stored in your inventory and can be opened with Keys.

Other news

Broadcom Set to Gain from Alphabet's Custom TPU Sales

Broadcom is set to benefit from Alphabet's decision to sell custom TPUs to external data centers, enhancing its AI semiconductor revenue through a long-term agreement until 2031.

user avatarBayarjavkhlan Ganbaatar

Alphabet Enters Hardware Market with Custom TPUs for Data Centers

Alphabet announces the sale of its custom-made Tensor Processing Units (TPUs) to external data centers, marking a significant move into hardware sales.

user avatarTenzin Dorje

CoinsBee and TRON DAO Launch Discount Campaign for USDT Payments

CoinsBee, in collaboration with TRON DAO, is launching a campaign that offers eligible users a 2% discount on purchases made with USDT on TRON.

user avatarMohamed Farouk

USDT on TRON Surpasses Bitcoin as Most Used Payment Method on CoinsBee

USDT TRC20 on the TRON network has become the most used on-chain token and payment option on CoinsBee, surpassing Bitcoin and Ethereum in payment activity.

user avatarElias Mukuru

Panel Discussion on Trading Insights at Zoomex After Party

A flagship panel titled 'Where's the Edge' will feature industry KOLs discussing trading strategies and market dynamics.

user avatarKenji Takahashi

Ollie Bearman to Host Interactive QA at Zoomex Event

Ollie Bearman will host an interactive QA session at the ZOOMEX TRADERS AFTER PARTY on October 7, 2026, providing a unique opportunity for traders and motorsport fans to engage directly.

user avatarDiego Alvarez

Important disclaimer: The information presented on the Dapp.Expert portal is intended solely for informational purposes and does not constitute an investment recommendation or a guide to action in the field of cryptocurrencies. The Dapp.Expert team is not responsible for any potential losses or missed profits associated with the use of materials published on the site. Before making investment decisions in cryptocurrencies, we recommend consulting a qualified financial advisor.