Data Reveals Robust Demand For ETFs Amid Record Performance

Bitcoin (BTC) is experiencing a bullish surge, reaching a new year-to-date high of $52,900 this week, fueled by strong inflows into spot exchange-traded funds (ETFs). Analysts attribute this positive momentum to several key factors, including rising investor demand for these ETFs, their positive impact on BTC price, and an overall shift in market sentiment.

Spot Bitcoin ETFs See Record Inflows, Driving Price Recovery

Spot Bitcoin ETFs, which track the price of the crypto directly, have witnessed significant inflows in recent weeks. According to a report by Bitfinex Alpha, these ETFs recorded net inflows exceeding $2.2 billion for the second consecutive week between February 12th and 16th.

This marks the highest weekly inflow ever recorded for Bitcoin ETFs, surpassing any other exchange-traded product among the 3,400 currently trading in the United States.

BTCUSD currently trading at $51.059. Chart: TradingView.com

Analysts believe these inflows are playing a crucial role in the digital asset’s recent price recovery. After a brief dip following the Consumer Price Index (CPI) data release, BTC has climbed steadily, reaching its highest point since December 2021. This uptrend coincides with the surge in ETF inflows, suggesting a potential link between the two.

BlackRock’s IBIT Leads The Charge, Grayscale’s GBTC Sees Outflows

Among the various Spot Bitcoin ETFs, BlackRock’s iShares Bitcoin ETF (IBIT) has emerged as the frontrunner, attracting a staggering $1.6 billion in inflows last week. This brings IBIT’s year-to-date inflows to a remarkable $5.2 billion, representing nearly half of BlackRock’s total net inflows across all their ETFs.

Other notable performers include Fidelity’s Wise Origin Bitcoin Trust (FBTC) with $648.5 million, Ark Invest/21Shares’ ARKB with $405 million, and Bitwise BTC Fund (BITB) with $232.1 million in inflows.

GBTC has $7bil outflows in past 5 weeks…

What a chart.

Outflows clearly slowing.

Interested to see what happens moving forward.

Play for Grayscale IMO is to launch “mini-GBTC” (spot bitcoin ETF at significantly lower fee). SPDR did this w/ GLD & GLDM.

via @biancoresearch pic.twitter.com/NrZnqzUiAi

— Nate Geraci (@NateGeraci) February 19, 2024

However, Grayscale’s Bitcoin Investment Trust (GBTC) continues to experience outflows, with investors withdrawing $624 million last week. This trend has persisted since the U.S. Securities and Exchange Commission (SEC) approved GBTC’s conversion from an over-the-counter product to an ETP in January, resulting in over $7 billion in capital depletion.

Profitable BTC Supply Grows, Bolstering Market Sentiment

As the king coin’s price rises, the portion of its supply held at a profit is also increasing. Currently, only 11% of the total BTC supply, purchased above $50,000, is held at a loss. This indicates that a majority of Bitcoin holders are now in profit, potentially contributing to a more bullish market sentiment.

Trading Volume Reflects Increased Interest

The Nine had biggest volume day since Day One with about $2b in combined trading thx to big contributions from $HODL, $BTCW and $BITB which all broke their personal records. For context $2b in trading would put them in Top 10ish among ETFs and Top 20ish among stocks. It’s a lot. pic.twitter.com/547pIl5grI

— Eric Balchunas (@EricBalchunas) February 20, 2024

Further highlighting the growing interest in Spot Bitcoin ETFs, trading volume reached nearly $2 billion last week, according to Bloomberg Intelligence senior ETF analyst Eric Balchunas. This marks the highest total since the first day of trading on Jan. 11th, indicating significant activity within this market segment.

Featured image from Pexels, chart from TradingView