CoinDesk 20 Index: 1,937.99 -6.61%
Bitcoin (BTC): $61,262.66 -3.99%
Ether (ETH): $2,459.36 -6.58%
S&P 500: 5,708.75 -0.93%
Gold: $2,651.59 -0.33%
Nikkei 225: 37,808.76 -2.18%

Bitcoin reclaimed $61,000 after dropping as low as $60,300 on Tuesdayamid an acute sharpening of tensions in the Middle East. Iran fired around 200 ballistic missiles in retaliation for Israel's recent attacks on Hezbollah, designated a terror group by more than 60 countries and organizations. Polymarket bettors are giving a 49% chance that Israel will retaliate against Iran by the end of the week. Bitcoin's slide dented hopes of a rally to kick off October, a traditionally bullish month for the world's largest cryptocurrency. BTC is currently over 4% lower in the last 24 hours, while the broader digital asset market has lost 6%, as measured by the CoinDesk 20 Index.

Some observers have noted the differing performances of bitcoin and gold as a measurement of the two assets' respective maturities. Gold, traditionally seen as a risk-off asset, gained 0.8% in the aftermath of Iran's attack on Israel while BTC lost 4%, despite often being referred to as a form of digital gold. “Gold is a much more mature asset, with a 5,000 year history as a store of value, so there’s not much room left for incremental network effects," Presto Research said. "BTC [has] only a 15-year history. This means it’s in the early stages of mainstream adoption, and its narrative is still poorly understood." At the time of writing, gold is 0.3% lower in the last 24 hours at $2,652.56 per ounce.

Crypto futures saw over $450 million in long liquidations in the past 24 hours as the bitcoin plunge led to losses among major tokens. CoinGlass data shows that bitcoin traders betting on higher prices lost more than $122 million, while bets on ether lost nearly $100 million. Smaller altcoins recorded over $85 million in liquidations – the most since July – with memecoin PEPE posting an unusually high $10 million. The data shows that nearly 86% of all futures bets were bullish. Traders were positioning for higher prices in the weeks ahead as October traditionally favors BTC, with negative returns only twice since 2013.

Grayscale's bitcoin ETF is reaping higher income than its rivals even as investors flee the vehicle for lower-cost options.

GBTC, with almost $14 billion in AUM, is earning about $205 million a year, roughly five times larger than at rival BlackRock IBIT, with $17 billion in AUM, CoinDesk calculations show.

The discrepancy is mainly down to fees, known as the expense ratio. Before the funds opened for trading on Jan. 11, operators jostling for customers started a price war that saw most settling on an expense ratio below 0.40%. GBTC, which existed as a trust before converting to an ETF, stood out, cutting the ratio just half a percentage point to 1.5%.

Even as investors have withdrawn funds in search of platforms with lower fees, GBTC's head start means the cash is still flowing in. In January, it had AUM of $29 billion.

The figure's shrunk to $13.65 billion, based on multiplying net assets value per share of $49.12 by the 278 million shares outstanding. It now holds about 220,000 bitcoin. IBIT, which holds 366,000 bitcoin, has 642 million shares outstanding and a NAV per share value of $35.13, giving AUM of $17 billion.

- James Van Straten