Coinbase to Levy Conversion Fees, Fidelity's Bitcoin ETF Outpaces GBTC's Outflows, BlackRock's Bitcoin ETF Surpasses $2 Billion
Summary:
Starting February 5, Coinbase will start charging fees for monthly USDC to USD conversions exceeding $75 million, excluding participants in the top two tiers of Coinbase Exchange Liquidity Program. Meanwhile, daily inflows into Fidelity's spot Bitcoin ETF surpassed Grayscale Bitcoin Trust's outflows for the first time since their launch. Additionally, the Bitcoin ETF from BlackRock, known as IBIT, has amassed over $2 billion in assets, housing more than 52,000 BTC. Industry experts suggest a possible Bitcoin supply squeeze due to higher demand from institutional investors.
Starting from February 5th, Coinbase, the top crypto exchange in the United States, will impose fees for USDC to USD conversions amounting to more than $75 million a month. This change will not apply to those in the Coinbase Exchange Liquidity Program's top two tiers. The news came via an update to Coinbase’s support page on January 30. Accordingly, starting from February 5, conversions exceeding $75 million within a 30-day cycle will incur a fee. Coinbase has clarified that the net conversion will be calculated by finding the difference between total USD to USDC and USDC to USD volumes over the last month.
Fidelity's spot Bitcoin ETF managed to attract daily inflows of $208 million on January 29, eclipsing the outflows from Grayscale Bitcoin Trust for the first time since their respective launches. As per tentative information from Farside Investors, Fidelity's FBTC saw inflows of $208 million on Monday, a figure that outweighs the $192 million exodus from GBTC. This is the smallest daily outflow from GBTC since its relaunch, according to data from BitMEX Research.
The drastic GBTC outflows, which are down by 25% from $255 million on the 26th of January and 70% lower than the record daily outflow of $641 million on the 22nd of January, have been a recent trend. The fund also saw the second-smallest outflow, next to the $95 million withdrawal on the 11th of January, the same day it transitioned to a spot Bitcoin ETF.
Meanwhile, the Bitcoin ETF from BlackRock, identified by the ticker IBIT, has crossed a milestone of $2 billion in Assets Under Management (AUM), a mere few weeks after its launch. The IBIT now has over 52,000 BTC or over $2 billion in its possession and has recorded the maximum total volume after the Grayscale Bitcoin Trust (GBTC). As per Bloomberg ETF analyst, James Seyyfart, the newly approved spot ETFs are balancing out the heavy GBTC outflows that have happened after it became a spot ETF.
According to Rajat Soni, a distinguished investor and active social media participant, BlackRock's investors are buying up more Bitcoin than the daily produced amount on the network. This indicates an imminent supply shortfall, which could potentially drive the prices up in the near future. “Blackrock clients are buying 2-5x the total daily production of BTC, which currently is around 900 BTC,” he added.This text does not provide investment guidance or recommendations. Each investment and transaction movement carries risk, and readers should do their own due diligence before making a decision.
Published At
1/30/2024 2:36:52 PM
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