The value of assets invested into crypto exchange-traded products or ETPs have increased by more than 90% over the past 30 days. Almost $36 billion is now invested in crypto ETPs, a 93.7% increase in only a month, according to a report released by research firm CryptoCompare. The spike in assets under management locked in crypto ETPs booms as more institutional investors are getting interested in cryptocurrencies. Meanwhile, the crypto ETP products have now become readily available.
Crypto ETPS Now Readily Available
The crypto ETPs market is surging as assets under management across all ETPs have shot up by 93.7% to $36 billion since December.
In January #ETPs experienced record investment ($35.96bn in AUM, up 95%) as well as trading volumes ($1.51bn/day, up 191%).
— CryptoCompare (@CryptoCompare) January 21, 2021
Exchange-traded products or ETPs track the value of an underlying asset similar to stocks. Crypto ETPs enables investors to invest in a particular cryptocurrency without actually holding the asset themselves. It becomes attractive for those who still want to invest in cryptocurrencies but without worrying about holding the coins.
With the booming price of Bitcoin and other cryptocurrencies, ETP products have become more available than previously.
The report added:
“These products make it easier for investors because they can be traded on traditional stock exchanges, with the complexities of custody and storage abstracted away from the end-user.”
Grayscale Bitcoin Trust Holds the Majority of AUM
The Grayscale Bitcoin Trust holds the majority of AUM, representing 63% of trading volume or $22.6 billion. Meanwhile, Grayscale Ethereum Trust (ETHE) is up 69.4% to $3.47 billion. Grayscale’s products represented 64% of the sector’s volume, driving $972 million in daily trade.
Despite Grayscale’s dominance of ETP products in trade volumes, it still underperformed the spot markets as the premium on Grayscale’s shares fell by 8% during January.
WisdomTree’s BTCW/USD was the second-most traded ETN with $7 million in daily volume after its trade activity increased more than 210%. Meanwhile, the 3iQ-listed trust product (QBTC) is the best performing Bitcoin product by market price over the last 30 days with an increase of 91.3%.