Eric Balchunas Bloomberg Interview

Eric Balchunas is a Senior ETF Analyst at Bloomberg. We discuss:

  • The Bitcoin ETF launch compared to other asset class ETF launches
  • Bitcoin ETF performance breaking records
  • When will Vanguard capitulate and offer the Bitcoin ETFs on their platform
  • The 80/20 and 60/40 investing strategy with a Bitcoin ETF and changing demographics
  • Banks want to custody the Bitcoin ETFs but SEC SAB 121 is a blocker
  • Will other ETF issuers follow Bitwise’s move of wallet address transparency
  • Hong Kong issuing a Bitcoin Spot ETF
  • Will the Ethereum Spot ETF be approved this year?

Key Takeaways:

  • Bitcoin ETFs have seen record-breaking success, surpassing previous launches in terms of volume, assets, and flows within the first seven weeks.
  • GLD was technically tied with Bitcoin ETFs in terms of performance when adjusting for certain factors, but overall, Bitcoin ETFs have outperformed all other new launches.
  • Volume in ETFs often predicts future flows and assets, as seen in the spike in Bond ETF volume in 2008 leading to increased assets in the following years.
  • Institutions are likely to prefer trading Bitcoin ETFs over the underlying currency in times of market volatility or illiquidity, similar to the trend seen with Bond ETFs in 2008.
  • The success of Bitcoin ETFs may pave the way for other cryptocurrencies like Ether to follow, but they may struggle to match the initial impact of Bitcoin.