<\/p>\n
- \n
- The total AUM for institutional crypto products increased by 6.74% to $31.7 million.<\/em><\/li>\n
- GBTC\u2019s discount to underlying Bitcoin dropped to its lowest level in nearly two years.<\/i><\/li>\n<\/ul>\n
Optimism was truly back in the digital assets market in October. Analysts and traders construed the recent fake news-induced market rally as a \u201cdress rehearsal\u201d before the eventual approval of spot Bitcoin [BTC]<\/a> exchange-traded funds (ETF).<\/p>\n
In response to the false alarm, the king coin ascended to $35,000, the highest level since May 2022, per data from CoinMarketCap<\/a>. By and large, BTC has held on to its gains since the event. As of press time, BTC exchanged hands at $34,000, with gains of 26% since the start of the month.<\/p>\n
Crypto market attracts institutional investors<\/h4>\n
The positive sentiment started to reflect on the trading activity. According to crypto market data provider CCData<\/a>, the average daily volume of digital asset investment products surged by a whopping 44.3% to $230 million. This was the third-highest monthly jump in volumes in 2023.<\/p>\n
![\"\"](\"https:\/\/statics.ambcrypto.com\/wp-content\/uploads\/2023\/10\/Trading-volumes.jpg\")
<\/a><\/p>\nSource: CCData<\/p>\n<\/div>\n
Moreover, the total assets under management (AUM) for institutional crypto products increased by 6.74% to $31.7 million, snapping a two-month long losing streak.<\/p>\n
![\"\"](\"image\/svg+xml,%3Csvg%20xmlns=\")
![\"\"](\"https:\/\/statics.ambcrypto.com\/wp-content\/uploads\/2023\/10\/Monthly-AUM.jpg\")
<\/a><\/p>\nSource: CCData<\/p>\n<\/div>\n
The AUM is a measure of the flow of investor money in and out of a fund and the market value of the underlying asset. The size of the AUM gives investors an idea about the investment company\u2019s operations.<\/p>\n
Most investors are drawn to funds with big AUM simply because they have sufficient liquidity to meet any redemption pressures.<\/p>\n
BTC-based products grow, Ether sees decline in investments<\/h4>\n
The jump in Bitcoin-based investment products witnessed an AUM increase of 11.1% to $23.2 billion. The jump expanded their market dominance to 73.3%, up from 70.5% last month.<\/p>\n
To the contrary, Ethereum [ETH]<\/a>-based crypto products recorded a decline of 5.45% in their AUM to $6.35 billion. The negative growth squeezed its market share to 20% from 22.6% in September.<\/p>\n
Surprisingly, the subpar performance occurred during the month that saw half-a-dozen Ether futures ETFs, including those by VanEck and ProShares, hitting the market.<\/p>\n
While ETH disappointed, other altcoin-linked products witnessed a sharp jump in market worth. Solana [SOL]<\/a>\u2013 based products were the biggest winners in October, witnessing a massive 74% increase in AUM.<\/p>\n
Positive improvements in its ecosystem, which resulted in price gains, aided in increasing the market worth of SOL-linked products. Indeed, SOL<\/a> was the second-highest gainer in the last 30 days, increasing its market value by a whopping 72%.<\/p>\n
![\"\"](\"https:\/\/statics.ambcrypto.com\/wp-content\/uploads\/2023\/10\/Solana-2.jpg\")
<\/a><\/p>\nSource: CCData<\/p>\n<\/div>\n
U.S., Canada experience rise in AUM<\/h4>\n
The dominant North American institutional crypto market reaped the fruits of the bullish outlook. The U.S., home to some of the biggest crypto asset managers, witnessed a 3.22% increase in AUM to $24.5 billion. With this, its market share increased to an astounding 77.3%.<\/p>\n
Canada, another important market, saw a $2.03 billion growth in AUM in October. Notably, Canada accounted for 6.39% share of the market, the second-highest after the U.S.<\/p>\n
Key European markets like Germany recorded a 16% growth in AUM to nearly $700 million.<\/p>\n
![\"\"](\"https:\/\/statics.ambcrypto.com\/wp-content\/uploads\/2023\/10\/AUM-by-domicile.jpg\")
<\/a><\/p>\nSource: CCData<\/p>\n<\/div>\n
GBTC narrows discount to underlying asset<\/h4>\n
Grayscale Investments, the world\u2019s largest crypto asset manager, observed a 3.24% increase in AUM to $23.1 billion in October.<\/p>\n
Moreover, its most popular product, Grayscale Bitcoin Trust (GBTC), narrowed the discount to the underlying holdings to its lowest level in nearly two years.<\/p>\n
![\"\"](\"https:\/\/statics.ambcrypto.com\/wp-content\/uploads\/2023\/10\/GBTC-2.jpg\")
<\/a><\/p>\nSource: CCData<\/p>\n<\/div>\n
Typically, a reducing discount between a trust\u2019s shares and the net asset value (NAV) of its holdings\u2014in this example, Bitcoin\u2014indicates that investors are bullish on the outlook.<\/p>\n
As indicated above, the discount to the NAV was nearly 45% in June. However, growing optimism<\/a> over conversion to a spot Bitcoin ETF, helped by recent court verdicts, led to a sharp decline. The discount fell to 12.6% on 18 October, the lowest since November 2021.<\/p>\n
Note that GBTC is the world\u2019s largest Bitcoin fund with a market cap of over $17.8 billion<\/a>. Grayscale wants to transform the trust into a spot Bitcoin ETF owing to the relative advantages that the latter provides.<\/p>\n
Will the party continue?<\/h4>\n
As things stood, the market appeared to be ready for a launch. The general sentiment was upbeat regarding the approvals of spot ETFs. Although there was clearly a shift in sentiment in October, it will be interesting to watch if the optimism lasts into November.<\/p>\n
The total market cap of all circulating cryptos increased to $1.26 trillion at press time, marking a 20% increase from last month.<\/p>\n
- GBTC\u2019s discount to underlying Bitcoin dropped to its lowest level in nearly two years.<\/i><\/li>\n<\/ul>\n
![\"\"](\"https:\/\/statics.ambcrypto.com\/wp-content\/uploads\/2023\/10\/market-cap_20230927_20231028_Coinmarketcap-scaled.jpeg\")