Overnight Bitcoin Gains Inspire New ETF Strategy Focused on After-Hours Trading

U.S.-based bitcoin traders who feel like BTC starts strong overnight only to slip once Wall Street wakes up aren’t imagining it. Fresh data from crypto analytics platform Velo.xyz confirms that over the past year, bitcoin has performed better during hours when traditional U.S. markets are closed and tends to dip during regular trading sessions. This pattern has caught the attention of analysts, including Bloomberg’s Eric Balchunas, who noted that the trend has persisted throughout 2024, suggesting that spot bitcoin ETFs or derivatives trading could be influencing price behavior during U.S. market hours.

Capitalizing on this emerging trend, Nicholas Financial Corporation, a boutique wealth management firm, has filed with the U.S. Securities and Exchange Commission for a new ETF designed specifically to exploit bitcoin’s overnight strength. The proposed Nicholas Bitcoin and Treasuries AfterDark ETF (NGTH) would buy bitcoin each day at 4 p.m. ET—when U.S. markets close—and sell it by 9:30 a.m. ET the following morning before traditional market trading resumes. During the day, the fund would move into short-term U.S. Treasuries, aiming to preserve capital while generating modest yield.

This innovative approach reflects growing investor interest in bitcoin investment products that look beyond simple asset exposure and instead consider trading behavior, liquidity cycles, and market timing. Nicholas Financial also submitted paperwork for a second product, the Nicholas Bitcoin Tail ETF (BHGD), further signaling its intent to expand within the digital asset investment space.

If approved, NGTH would introduce one of the first ETFs structured around time-based bitcoin trading, potentially offering investors a new way to benefit from BTC’s overnight performance patterns while avoiding the volatility often seen during U.S. trading hours.