Bitcoin ETFs Witness $1.8 Billion Inflow, Marking Second-Highest Weekly Record, Prompting BTC Price to Revisit $69K

Last week witnessed a significant boost in cryptocurrency investment products, with a staggering $1.84 billion inflow, indicating a surge in investor confidence and a bullish market sentiment. CoinShares reported that trading volume for these products also hit a record high of over $30 billion. Consequently, the price of BTC experienced a massive leap today, surpassing a new yearly high of $65,000.

Buyers’ Confidence Soars with Rising ETF Inflows

Bitcoin’s surge past the $65,000 mark today led to the liquidation of short positions worth more than $60 million, driven by substantial investments in ETFs and increased interest from institutional investors the previous week. Coinshares revealed that there were almost record-breaking weekly inflows into digital asset investment products, totaling $1.84 billion. Additionally, trading volumes skyrocketed, exceeding $30 billion and accounting for half of Bitcoin’s worldwide trading volume on major exchanges.

Following recent increases in BTC price, the total value of assets under management (AUM) is now approaching the peak of $82.6 billion, just shy of the record set in early November 2021 at $86 billion. The United States remains at the forefront of the market, with net inflows reaching $1.88 billion, though slightly offset by higher outflows from Grayscale’s Bitcoin ETF, totaling $1.46 billion.

However, new issuers in the market compensated for these outflows, resulting in a net inflow of $3.2 billion over the past week. Investment patterns varied by region, with Switzerland witnessing inflows of $20 million, while Sweden, Germany, and Canada faced outflows of $32 million, $35 million, and $23 million, respectively.

Bitcoin emerged as the primary beneficiary of these inflows, securing 94% of the total or $1.72 billion. With its momentum holding above $65,000, Bitcoin is now closing in on the record of $69,000.

Bitcoin ETFs Outpace Gold: A New Normal

On February 28, the peak trading volume surpassed $7.6 billion, making it the second-highest trading day, followed by the third highest on March 1. In just over seven weeks, BlackRock’s iShares Bitcoin Trust (IBIT) has reached over $10 billion in assets under management, a feat that took the first U.S. gold-backed ETF, the SPDR Gold Shares (GLD), more than two years to achieve after its launch in 2004.

Notably, BlackRock’s Bitcoin ETF achieved this milestone on March 1, a mere 39 trading days post-launch, significantly outpacing GLD’s timeline.

Eric Balchunas, Bloomberg’s ETF analyst, noted in late February that Bitcoin ETFs are gaining an advantage over gold as the preferred store of value, suggesting a strong possibility that Bitcoin ETFs could surpass gold ETFs in AUM in less than two years.

The reach of Bitcoin ETFs is expanding, with BlackRock’s iShares Bitcoin Trust ETF (IBIT) now trading on Brazil’s B3 stock exchange, as announced by the company last week. Felipe Gonçalves, B3’s superintendent of interest and currency products, stated in a press release, “This launch offers investors a new way to access Bitcoin.”

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Bitcoin
Bitcoin ETF
Cryptocurrency