Short interest in the Inverse Bitcoin ETF has increased by 300 percent.
Since the Securities and Exchanges Commission (SEC) first approved them last year, interest in bitcoin ETFs has been high. While some of that interest has subsided, bitcoin ETFs are still a good choice for institutional investors who want to make bets on the digital asset but do not want to hold any of it themselves. The short bitcoin ETFs have now started to take over the market after the success of the futures bitcoin ETFs.
Barrels of ProShares BITI ahead
Since its launch, the ProShares BITI ETF, also known as the first short bitcoin ETF in the United States, has generated a lot of buzz. The ETF, which is just a little more than a week old, has won the attention of institutional investors, who have rushed to it in droves to benefit from it. Given how quickly inflows have come in, this has caused one of the quickest growth rates in the history of bitcoin ETFs.
Four days after its debut, the BITI was said to have created a stir, growing to become the second-largest bitcoin ETF in the nation. As it has become more well-known, investors have flocked to it in droves. It would do even better in its second week, breaking a new BTC record.
BITI’s holdings have increased to a total of 3,811 BTC as of early this week. The majority of the inflows into the ETF occurred around the end of June, when it received 700 BTC and 1,684 BTC on June 29 and 30, respectively.
With this, BITI has advanced and, while it continues to be the second-largest BTC ETF in the area, it has increased the distance between it and rivals like Valkyrie and VanEck bitcoin futures ETFs.
Are Traders Negative On Bitcoin?
The fact that $51 million, a new record, is said to have flowed into short BTC ETFs during the previous week does appear to indicate that institutional investors are pessimistic about the future of bitcoin.
However, this is only true when viewed from a particular angle.
The ProShares BITO, a long BTC ETF, nevertheless outperforms the BITI despite its enormous rise. At $3,811, the size of the short bitcoin ETF is just approximately 12% that of its long equivalent. This demonstrates that even while interest in short bitcoin ETFs is rising, the bulk of investors still choose to have long positions in bitcoin, which indicates a bullisher mood.
However, the BITI inflows indicate that more investors are looking to profit on the alleged market downturn, even if only in the near term.
According to industry experts, this should continue at least through the end of the year. It follows that it is not surprising that investors are looking to make money off of what they predict will be another six months of price declines.