Appetite for Bitcoin in Singapore and beyond surges after 2024’s launch of such ETFs, US election

INVESTOR interest in the world’s largest cryptocurrency Bitcoin in Singapore and elsewhere rose last year, driven by factors such as the introduction of such exchange-traded funds (ETFs) in the beginning of the year, as well as Donald Trump’s US election win.

Chang Wei Liang, DBS foreign exchange (FX) and credit strategist, said Bitcoin’s rising demand among both individual and institutional investors followed the introduction of US Bitcoin ETFs in January 2024, with 11 spot Bitcoin ETFs approved by the US Securities and Exchange Commission.

Since then, Bitcoin ETFs recorded nine out of 11 months of monthly net inflows, with total net assets of US$30.7 billion as at Nov 29, based on a report by Crypto.com. BlackRock’s iShares Bitcoin Trust grew to more than US$50 billion in assets in just 11 months – breaking records with no other ETF having a better launch, Bloomberg indicated.

As at Dec 31, Bitcoin was trading at around US$93,619.80 – a jump of around 111.8 per cent in the year to date. It last traded at around US$102,218 on Tuesday (Jan 7).

A recent catalyst for Bitcoin’s rally was endorsement from US president-elect Trump. The asset soared above US$100,000 for the first time on Dec 5 after he won the presidential election in November. Known to be pro-crypto, he has pledged to make the world’s largest economy the “crypto capital of the planet”, with plans to accumulate a national stockpile of Bitcoin.

Spikes in trading volumes

Brokerages and exchange platforms based in Singapore reported spikes in trading volumes in 2024 for Bitcoin ETFs and direct investments into the cryptocurrency.

Moomoo Singapore observed a more than 200 per cent increase in trading volume of Bitcoin ETFs in November last year compared to October, said chief executive Gavin Chia. More than 50 per cent of the platform’s crypto traders in 2024 were Singaporeans.

Jason Fu, deputy head of global markets at Phillip Securities, noted that there was “a substantial increase in trading interest” in the asset among the company’s clients since its launch in January 2024.

“By the end of last year, our clients’ assets under custody (AUC) in Bitcoin ETFs had grown to nearly 3 per cent of the overall AUC across all ETFs, with interest evident across all age groups,” he said.

Lim Wee Kian, chief executive of DBS Digital Exchange, said last year’s Bitcoin rally had “greater participation” from institutions and high-net-worth individuals as compared to previous cycles.

Over at digital trading platform Tokenize Xchange, total trading volume rose 1,900 per cent on the year.

The surge was driven by improved market sentiment and an expanded range of offerings, the platform’s chief executive and founder Hong Qi Yu told The Business Times.

“Bitcoin trading volumes were a major contributor, growing by nearly 900 per cent compared to the previous year,” he said.

Liu Yusho, co-founder of Coinhako, said Bitcoin’s accumulation in the past year was “unprecedented”, dwarfing even 2021’s bull market for crypto. He added that the crypto exchange witnessed 500 per cent more retail users trading after the breakout in November and December 2024, relative to October 2024, with that year’s retail spot volumes up 320 per cent from 2023.

“This activity is likely driven by increased optimism over institutional adoption and anticipation over a more conducive regulatory environment following Trump’s presidential win,” he said.

Bitcoin ETFs provide investors with an additional avenue to gain price exposure to the world’s largest cryptocurrency, said Ong Chengyi, head of Asia-Pacific policy at blockchain analysis provider Chainalysis.

“Should Bitcoin continue to rise, it is reasonable to expect that some of the resulting demand will be channelled into ETFs,” she added.

Spot Bitcoin ETFs are, however, not approved for retail investors by the Monetary Authority of Singapore as of January 2024.

The authority had reiterated then that trading in cryptocurrencies is highly volatile and speculative in nature, and has deemed such transactions unsuitable for retail investors.

But this is unlikely to dampen the popularity of crypto trades among investors, said Collin Seow, founder of trading community Systematic Trader. “Just like our gold ETFs, compared to the US gold ETFs, it is much lower. So savvy investors will just go to the US market to buy Bitcoin ETFs,” he added.

Seow said the number of members tripled to some 6,500 after the US election, with a majority of them being Singaporeans. Bitcoin is among the community’s top trades.

The situation now is a vast difference from how the cryptocurrency scene was just two years ago, when Bitcoin plunged more than 60 per cent in 2022, leading a rout in digital assets that erased some US$2 trillion in total market value from the highs reached in November 2021.

There was also the demise of some crypto exchanges such as FTX, which filed for bankruptcy in November 2022, and Singapore-based crypto lending and borrowing platform Hodlnaut, which was ordered to be liquidated by the city-state’s high court in 2023 after it was investigated for cheating and fraud offences.

Another bullish year?

Market watchers believe that Bitcoin will continue to gain more popularity among both individual and institutional investors.

Matt Long, FalconX’s general manager of Asia-Pacific and Middle East, believes that the next two years – before the US mid-term election – will be a “golden era” for the mainstream adoption of digital assets.

“As regulation and market structure rapidly evolve, demand will accelerate and I expect to see further positive demand-side shocks,” said Long, noting that Bitcoin has a finite supply.

Ong of Chainalysis expects prices to rise further amid greater regulatory clarity, easing constraints on traditional finance participation in crypto, as well as US’ hopes of building a strategic Bitcoin reserve.

While DBS’ Chang said it is difficult to gauge the timeline, he said a more permissive regulatory environment in the US may see Bitcoin reach US$200,000 under Trump’s presidency.

Moomoo Singapore’s Chia said investors are now “seeking a larger allocation” to digital assets to drive portfolio growth as part of their long-term investment strategy.

Hong of Tokenize Xchange also said more first-time investors are getting involved in the crypto space as the market continues to mature.

“As regulatory clarity improves and market confidence grows, we anticipate more people to return to brokerages like ours to trade crypto, driven by enhanced trust and accessible opportunities,” he added.