- Bitcoin tends to perform better outside U.S. market hours and weaker when U.S. markets are open.
- Nicholas Financial Corporation plans to launch a bitcoin ETF that trades only overnight, avoiding the U.S. trading day.
- The proposed ETF would buy bitcoin after U.S. markets close and sell before they open, investing in short-term U.S. Treasuries during the day.
- Another bitcoin-related ETF product named the Nicholas Bitcoin Tail ETF has also been filed with the SEC.
- Market data suggests that derivatives or spot ETF positioning might influence Bitcoin’s price movement relative to U.S. market hours.
U.S.-based bitcoin (BTC) investors have observed that bitcoin prices often rise when U.S. markets are closed and decline during regular U.S. trading hours. This pattern is supported by data from crypto analytics platform Velo.xyz, which shows bitcoin’s hourly price performance over the past year favors gains outside of U.S. market hours. According to data and statements from Bloomberg’s Eric Balchunas, a similar trend continues into 2024, potentially driven by spot ETFs or derivative positioning.
In response, Nicholas Financial Corporation, a boutique wealth management firm, has filed with the U.S. Securities and Exchange Commission (SEC) to create a new bitcoin exchange-traded fund (ETF). The fund, called the Nicholas Bitcoin and Treasuries AfterDark ETF (NGTH), would exclusively hold bitcoin overnight, from 4 p.m. Eastern Time (ET) when U.S. markets close, until 9:30 a.m. ET when markets reopen. During the daytime trading hours, the ETF would shift its holdings into short-term U.S. Treasuries to protect capital and earn yield. The filing is available here.
Additionally, the firm has submitted paperwork for another bitcoin product called the Nicholas Bitcoin Tail ETF (BHGD). If these ETFs receive regulatory approval, they would introduce a time-sensitive strategy to bitcoin investment products by considering the influence of market hours on bitcoin’s price movement.
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