The recent approval of spot Bitcoin exchange-traded funds (ETFs) is fueling a resurgence of interest in cryptocurrency markets with hedge funds, a core client base for Goldman Sachs, showing renewed enthusiasm for the asset class.

According to data from BitMEX Research, the ten spot Bitcoin ETFs approved by the U.S. Securities and Exchange Commission collectively shed a total of $888 million over the past week, with the exodus being led by a record outflow day for Grayscale's GBTC on March 18th.

BlackRock's Head of Digital Assets, Robert Mitchnick, has said that Bitcoin is the primary interest of the firm’s clients, with Ethereum attracting “ a little bit” of attention and every other cryptocurrency seeing “very, very little demand.”

Top stories in the Crypto Roundup today:

• Goldman’s Hedge Fund Clients Ramp Up Crypto Options Trading
• Spot Bitcoin ETF Frenzy Cools Off After Week of Outflows
• Bitcoin Tops Client Interest at BlackRock While ETH Sees ‘a Little Bit’ of Demand, Says Head of Digital Assets

Goldman’s Hedge Fund Clients Ramp Up Crypto Options Trading

The recent approval of spot Bitcoin exchange-traded funds (ETFs) is fueling a resurgence of interest in cryptocurrency markets with hedge funds, a core client base for Goldman Sachs, showing renewed enthusiasm for the asset class.

Goldman Sachs launched its cryptocurrency trading desk in 2021 and currently offers clients access to cash-settled Bitcoin and Ether options, as well as CME-listed Bitcoin and Ether futures, even though the bank does not directly trade the underlying cryptocurrencies themselves.

Goldman Asia Pacific’s head of digital assets, Max Minton, has said that the ETF approval “triggered a resurgence of interest and activities” from the bank’s clients. The majority of this demand is coming from Goldman's existing client base, particularly traditional hedge funds.

However, Minton noted that the bank is also expanding its reach to "a wider universe of clients," including asset managers, traditional bank clients, and select digital asset firms. He noted clients are using crypto derivatives for a variety of purposes, including directional bets on the price of cryptocurrencies, yield enhancement strategies, and hedging.

Bitcoin remains the primary focus for Goldman's clients when it comes to crypto-related products, although interest in Ether-based products could shift if and when Ether ETFs receive regulatory approval in the United States.

Spot Bitcoin ETF Frenzy Cools Off After Week of Outflows

The once red-hot spot Bitcoin exchange-traded funds market appears to be tempering, with a record-breaking five straight days of net outflows cooling investor sentiment.

According to data from BitMEX Research, the ten spot Bitcoin ETFs approved by the U.S. Securities and Exchange Commission collectively shed a total of $888 million over the past week, with the exodus being led by a record outflow day for Grayscale's GBTC on March 18th.

The decline in investor enthusiasm is further underscored by weak inflows into the leading Bitcoin ETFs. BlackRock's iShares Bitcoin Trust (IBIT), which controls nearly half the market share, saw record-low inflows of $49.3 million on March 20, and an even lower figure of $18.9 million on March 22.

Fidelity's Wise Origin Bitcoin Fund (FBTC), the third-largest player, also experienced a dismal week, with inflows scraping a mere $2.9 million on March 21. While inflows were negative, trading volumes remained significant spot these ETFs.

While the outflows coincide with a recent pullback in Bitcoin's price, analysts suggest there may be more at play. Bloomberg ETF analyst Eric Balchunas points to the possibility that Grayscale's unusually large outflows could be linked to trading activity by digital financial firm Genesis.

Bitcoin Tops Client Interest at BlackRock While ETH Sees ‘a Little Bit’ of Demand, Says Head of Digital Assets

BlackRock's Head of Digital Assets, Robert Mitchnick, has said that Bitcoin is the primary interest of the firm’s clients, with Ethereum attracting “ a little bit” of attention and every other cryptocurrency seeing “very, very little demand.”

Mitchnick revealed he was unfamiliar with the meme-inspired cryptocurrency dogwifhat (WIF) when asked whether BlackRock would be launching an ETF offering exposure to it, and underscored BlackRock isn’t focused on offering a “long tail” of crypto services.

The world’s largest asset manager launched a spot Bitcoin exchange-traded fund in the United States earlier this year that has attracted record inflows, and last week announced the launch of its first tokenized fund on a public blockchain, the BlackRock USD Institutional Digital Liquidity Fund (BUIDL).

BUIDL is set to offer qualified investors the opportunity to earn U.S. dollar yields through a tokenized structure. Investors can subscribe to the fund through Securitize Markets, a firm specializing in digital asset securities.

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