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Happy Friday. The crypto industry spent months pinning its hopes on the long-awaited arrival of Bitcoin ETFs, which would help it break out of a painful bear market and let digital assets take their rightful place in the world of mainstream finance. Those ETFs finally arrived last Thursday. So were they a success? An initial flurry of marketing spin made it hard to tell, but now some clear signals are emerging.

On the price front, Bitcoin has actually slumped significantly since the launch, but that doesn’t mean the ETFs have been a flop. The slump follows a wild run-up in crypto prices that came in anticipation the SEC would approve the new product, so the recent drop reflects an expected “sell the news” moment. Meanwhile, the market for Bitcoin ETFs is already reportedly more valuable than the one for silver with BlackRock’s ETF already pulling in more than $1 billion on its own.

More intriguing is what comes next. I spoke with Ophelia Snyder, whose 21.co helped stand up Ark Invest’s Bitcoin ETF, which was fourth of the 11 new ETFs with $2.7 million of trading volume on Thursday, to get a better sense of where things are going. She made the case that much of the early movement is from organic retail trading and that the market can expect a lot more inflows once financial advisors start recommending Bitcoin ETFs to their clients.

According to Snyder, these advisors are currently able to pick up the phone and fill a customer’s order for Bitcoin shares but need to assess the market before actively putting them in portfolios. She expects that to happen in the coming weeks and months, which will drive up demand—and of course the price. Snyder is obviously not impartial here but her thesis makes sense.

Another thing that’s becoming apparent one week into Bitcoin ETF trading is which of the 11 newly launched ETFs are gaining significant market share. While assets under management tell part of the story, that metric can also be misleading since some of the funds’ size reflects, in Snyder’s words, a “bring your own assets” playbook—meaning they drew on their own capital to help juice their launches. That’s the case with category leaders BlackRock and Fidelity and with BitWise, which launched with a “seed partner” that invested heavily.

The better way to assess the new ETFs’ early performance is by daily trading volume and, on that front, BlackRock and Fidelity are also way out front with volumes of $17.7 million and $9.7 million on Thursday. BitWise was next with $2.8 million, just ahead of Ark. Meanwhile, the other new ETFs (aside from Grayscale, which is a special case) posted less than 10% of those volumes, raising questions about their long-term viability.

The upshot of all this is that the long-awaited Bitcoin ETFs are an initial success, and, if optimists like Snyder are right, this is just the beginning.

Jeff John Roberts
jeff.roberts@fortune.com
@jeffjohnroberts

DECENTRALIZED NEWS

Bitcoin dropped to its lowest level in a month, briefly dipping below $40,000, as the ETF mania cools and as traders pocket recent gains. (Bloomberg)

The total amount of cryptocurrency used in scams dropped in 2023 from the year before, while stablecoins continued to eclipse Bitcoin as scammers' go-to currency. (Chainalysis)

A veteran of LedgerPrime, which failed after being acquired by FTX, is back with a new firm called Liquid Capital whose focus is crypto projects with liquid tokens. (Fortune)

The SEC, as expected, decided to delay a decision on whether to approve Fidelity's application for an Ethereum ETF until March. (The Block)

Robinhood will pay $7.5 million to Massachusetts to resolve an investigation into its practices of luring novice investors with confetti and other gamification tricks, which it largely stopped in 2021. (Reuters)