Demand for Crypto Soars: Bitcoin Funds Break Records, Goldman Sachs Wants In

Investors are increasingly seeking exposure to bitcoin following the recent months-long price rally. Bitcoin exchange-traded products are seeing record trading volumes. Meanwhile, more big banks are reportedly trying to get into the crypto space, including Goldman Sachs.

High Demand for Bitcoin and Crypto Products

With the price of bitcoin rapidly rising over recent months, more investors are seeking exposure to the cryptocurrency. The price of bitcoin rose about 24% since the beginning of the year and over 90% since the beginning of December.

One bitcoin exchange-traded product in particular, BTCE, has recorded an average daily trading volume of $69 million in the first 11 days of January, the Financial Times reported Friday, citing data from Deutsche Börse where it is trading. This week, Switzerland’s principal stock exchange revealed that its crypto trading volume hit a record high of $1.2 billion in 2020. The exchange now lists 34 crypto exchange-traded products.

Grayscale Investments’ Bitcoin Trust posted an average daily turnover of almost $1 billion in the first two weeks of this year, which is more than nine times the average in 2020, the publication added. The bitcoin trust’s assets under management grew from $1.8 billion to $17.5 billion during the year.

Meanwhile, Canadian asset manager 3iq says its bitcoin fund has reached a milestone, exceeding one billion Canadian dollars ($785 million) in assets under management. Besides the bitcoin fund, the company offers the ether fund and a global crypto-asset fund.

Demand for Crypto Soars: Bitcoin Funds Break Records, Goldman Sachs Wants In
Chart of 3iq’s bitcoin fund. Source: 3iq

Big Banks Want In, Including Goldman Sachs

As bitcoin continues to outperform other assets, more major companies are seeking to get into the crypto space. Goldman Sachs’ global head of commodities research, Jeff Currie, said last week that the bitcoin market “is beginning to become more mature” after he called BTC “a retail inflation hedge.” The investment bank…

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