Bitcoin slips from record high as ETF mania subsides

Cryptocurrencies declined on Friday following an ETF-fueled rally that saw it reach a record $67,016 on Wednesday, as investors questioned whether the new investment vehicle will attract as much new money to the assets as some have speculated.

Bitcoin, the world’s largest cryptocurrency, was trading at $63,498.16 as of 3:36 p.m. in Riyadh, a drop of 2.5 percent over the previous 24 hours.

Ethereum, was 2 percent lower at $4,125.40 after approaching its all-time high of $4,380 from May.

Bitcoin’s recent rally — six months after its previous top of $64,895 — was fueled by the debut of the ProShares Bitcoin Strategy ETF.

A dozen other futures-based bitcoin ETFs could launch in the coming months, with The Valkyrie Bitcoin Strategy ETF set to begin trading on Friday under the ticker BTF. The VanEck Bitcoin Strategy ETF expected to begin trading next week under the ticker XBTF.

Investors have bet the longawaited launch of bitcoin ETFs will lead to greater investment from both retail and institutional investors, but analysts at JP Morgan suggested in a note that the ProShares ETF could have limited effect on investment volumes because there are so many options for investors already.

The ProShares ETF has created a significant shift in the balance of power among cryptocurrency exchanges. The Chicago Mercantile Exchange, host to the ETF, has replaced Binance as the world’s biggest bitcoin futures platform this week.

As of 2 p.m. Riyadh time, the CME accounted for 22 percent, or $5.68 billion, of the total global futures open interest of $25.7 billion, while Binance contributed $5.66 billion, CoinDesk reported.