Korbit, 3Q institutional investor fund trend analysis... “There is a possibility of launching an altcoin spot ETF.”

Korbit Research Center, affiliated with Korbit, a domestic virtual asset exchange, announced on the 13th that it had published a report analyzing the financial trends of institutional investors in the third quarter of this year.

Korbit Research Center analyzed the trends of institutional investors by referring to the Bitcoin (BTC) wrapper, the Chicago Mercantile Exchange (CME) BTC futures market, the size of virtual asset fund operating funds, and the institutional trading volume in Coinbase. First of all, the inflow of funds from short-term institutional investors has reached its peak. In the first week of this month, the total assets under management of BTC wrapper funds increased by 72% compared to last January. This is interpreted to be because the price of BTC soared last month when signs were detected that the approval of a BTC spot exchange-traded fund (ETF) was imminent.



The recovery of long-term institutional investor funds was delayed. The size of virtual asset fund management funds in the third quarter of this year was the same as the previous quarter, but the size of the private funding market fell to the lowest level since 2020. Korbit Research Center said, “It will take time for the funding market to recover due to the high interest rate situation, but initial investment demand for decentralized finance (DeFi) and Web 3 is steady,” adding, “If the price of virtual assets continues to rise, the venture capital market will also improve.” “There is room,” he explained.

Global virtual asset exchange Coinbase's institutional trading volume in the third quarter amounted to $65 billion, down 17% from the previous quarter. Korbit Research Center analyzed, “This is because market maker (MM) activity is sluggish. If the BTC spot ETF is launched this year and the entry of institutional investors into the virtual asset market becomes visible, institutional trading volume will increase before the first quarter of next year.”

Korbit Research Center emphasized that the situation following the approval of the BTC spot ETF is important. This is because if the BTC spot ETF is approved, attention may focus on whether the Ethereum (ETH) spot ETF will be approved. In addition, it was analyzed that spot ETFs based on various virtual assets other than BTC and ETH could be released. Korbit Research Center said, “Virtual asset management companies such as Grayscale and CoinShares are operating investment products based on Ethereum Classic (ETC), Ripple (XRP), Solana (SOL), etc.” and “We have signed a monitoring sharing agreement to monitor prices.” “If manipulation risks are controlled, it will be possible to launch an altcoin spot ETF,” he explained. Jeong Seok-moon, head of Korbit Research Center, said, “Until the third quarter, institutional fund inflow was concentrated in BTC, and funds were outflow from ETH or multi-asset products, so it does not reflect the possibility of approval of an altcoin spot ETF.” He added, “This will serve as a signal for the launch of ETF, and institutional funds will flow in more quickly in the future.”

Reporter Choi Jae-heon

chsn12@decenter.kr