In the wake of the US Securities and Exchange Commission’s [SEC] green light for 11 spot Bitcoin exchange-traded funds [ETFs], a wave of FOMO [Fear of Missing Out] has swept through the European crypto community. While the US market is abuzz with excitement, European investors are reevaluating their positions as the US ETFs gain prominence.
The crypto landscape in Europe already features a variety of crypto exchange-traded products [ETPs], providing retail investors with exposure to digital assets. However, the recent SEC approval has triggered a notable shift. According to BitMEX Research, just four days after the approval of the US Bitcoin spot ETF, the four largest European Bitcoin ETPs recorded a staggering single-day outflow of $30 million. This trend continued, resulting in a total outflow of approximately $106 million over five days.
The shift in investor sentiment is evident in the data provided by Cointucky Derby on day four of the ETF flow update. While US data is yet to be disclosed, European investors are moving away from high-fee BTC ETPs, contributing to a $30 million outflow across the four largest European products on that day alone.
Notably, European ETP giants like 21Shares, CoinShares, and WisdomTree have been at the forefront of this movement. Initially, when uncertainty surrounded the approval of a spot ETF in the US, market experts were banking on Europe. Despite the introduction of Europe’s first spot Bitcoin ETF on August 15, 2023, regulatory hurdles have made a Bitcoin ETF less likely in the region. However, existing ETPs demonstrate Europe’s progressive stance on crypto products.
Bitcoin ETP Giant
The ETC Group, boasting a $1.3 billion AUM market value for its BTC ETP, leads the European market. Following the SEC’s approval of the spot Bitcoin ETF, the ETC Group announced a new ETP tracking 20 leading digital assets.
While skepticism persists regarding the possibility of a spot ETF in Europe, not everyone views the situation with caution. Thomas Romain, the commercial director of crypto exchange Bitpanda in France, emphasized the significance of adapting to the evolving landscape, stating, “Any European bank or financial institution that isn’t ready to adapt is going to be left behind very quickly.” He sees the SEC-approved institutions as “massive institutions with trillions of dollars under management,” signaling a major shift in the global financial industry’s embrace of digital assets.