Bitcoin (BTC) has experienced a shift in its daily gains, with most of them now occurring outside of United States trading hours since the introduction of spot Bitcoin exchange-traded funds (ETFs). This change presents an opportunity for traders to capitalize on smaller profit margins, according to analyst Markus Thielen. Previously, gains were concentrated during U.S. trading hours, but now investors can buy Bitcoin before U.S. trading hours and sell it a few hours later. On April 4, Bitcoin saw a 2.6% rally outside U.S. hours, compared to only a 0.6% increase during U.S. hours. Bloomberg ETF analyst Eric Balchunas also noted that the majority of Bitcoin’s 40% gains since the launch of spot Bitcoin ETFs have occurred outside regular U.S. market trading hours. U.S. trading hours refer to the operating hours of the New York Stock Exchange and Nasdaq stock exchange, which run from 2:30 pm to 9:00 pm UTC.
Thielen further explained that investors, including those from different time zones, often anticipate surges in ETF inflows by buying Bitcoin before the market opens. This data analysis also revealed that Bitcoin tends to rise during the 1-4 hours before U.S. ETFs start trading, indicating possible front running of the ETF flow. For instance, on April 4, Bitcoin experienced a 2.6% increase in the four hours before the U.S. market opened. However, Thielen pointed out that U.S. investors tend to take advantage of the market spread between the spot market and the futures market, with hedge funds pocketing the futures premium.
This trend of gains outside U.S. trading hours is not unique to Bitcoin. In 2022, two ETF funds were launched to benefit from overnight increases in U.S. stocks, but they were discontinued a year later due to other factors that affected their performance, such as off-hours announcements, data releases, and earnings reports.
Before the introduction of spot Bitcoin ETFs, Asian investors were known for selling during Asian market hours. However, in recent years, U.S. and European investors have provided bid support, while Asian markets have generally shown lower buying support and exerted selling pressure.
It’s important to note that this article does not provide investment advice or recommendations. Readers should conduct their own research and make informed decisions when it comes to investments and trading.