Early US ETF Investors Now Recognized As Long-Term Holders
By: Isha Das
Early US ETF Investors Now Recognized As Long-Term Holders
Investors in the first US-based Bitcoin ETFs, launched in January, are now considered long-term holders (LTHs) after surpassing the 155-day threshold. According to a report, these LTHs have shown remarkable resilience, even through significant market corrections in recent months.
On January 11, 2024, the US introduced its first Bitcoin ETF. Investors who participated then are now identified as LTHs, with an average cost basis of $58,049. Amidst Bitcoin's current trading value exceeding $62,000, the investment yields about a 7% return. The transition from short-term holders (STHs) to LTHs indicates a shift to less market sensitivity, a trait typical among LTHs who are less reactive to short-term price fluctuations.
The launch of the Bitcoin ETF attracted a broad array of investors, keen on institutionalizing their holdings. Since then, these investors have navigated substantial market downturns, including a nearly 20% correction starting on June 7. During this period, the LTHs' cost basis was approximately $57,600. The price plummet to $56,500 on May 1 also saw similar resilience from LTHs, whose average cost basis hovered around $56,300.
This consistent investment behavior during market dips underscores a strategic approach of 'buying the dip' among LTHs, providing support to Bitcoin's market structure during intense volatility. Their sustained participation showcases the enduring confidence and strategic financial planning in the crypto market, reinforcing the maturity in handling crypto assets among institutional investors.
On the Horizon: Ether Spot ETFs
As Bitcoin ETF investors adapt to long-term holding strategies, the market anticipates the broader impact of Ether spot ETFs. The upcoming introduction of these ETFs is expected to further catalyze institutional interest in digital assets. Analysts predict that the new Ether products will encourage a more diversified investment landscape, potentially echoing the positive market influences seen with the Bitcoin ETFs.
