US Bitcoin ETFs exceed 15 billion in value while the price of BTC lags behind whats the reason
Key Points
– US Spot Bitcoin ETFs have seen a 19-day streak of inflows, boosting assets to $62.3 billion.
– BlackRock’s iShares Bitcoin Trust has overtaken Grayscale to become the world’s largest fund.
– Despite record inflows, Bitcoin’s price struggles to reach its all-time high.
A fascinating trend is emerging in the realm of Bitcoin. US Spot Bitcoin exchange-traded funds (ETFs) are experiencing an unprecedented surge, attracting a massive $15.6 billion in inflows over 19 consecutive days.
However, despite this flurry of investment, Bitcoin’s price remains below the highly anticipated peak of $73,679. What could be causing this discrepancy?
Delve deeper to uncover the reasons behind this disconnect and its implications for the future of Bitcoin.
The Rise of Bitcoin ETFs
Since their inception, these ETFs have captivated investors, accumulating an impressive $15.6 billion in inflows and amassing total assets of $62.3 billion. Globally, Bitcoin ETFs now hold around 1.3 million BTC, making up a significant 5.2% of the circulating supply.
This surge in popularity of Bitcoin ETFs, led by industry titans like BlackRock Inc. and Fidelity Investments, signals a notable shift in the crypto landscape from Asia to the United States.
Last week, BlackRock’s iShares Bitcoin Trust, valued at $21.4 billion, surpassed Grayscale Investments LLC’s $20.1 billion Bitcoin Trust to become the world’s largest fund for the token. Fidelity’s Wise Origin Bitcoin Fund, with $12.3 billion, holds the third position.
The increase in ETF inflows aligns with regulatory changes, including the SEC’s approval of spot Bitcoin ETFs earlier this year. This regulatory shift has not only reshaped the crypto industry but also redirected its focus towards the United States, moving away from its traditional stronghold in Asia.
The SEC’s Vital Role
After allowing spot Bitcoin ETFs in January and spot Ethereum ETFs in May, the SEC is currently revising regulations for the crypto sector. Despite Chair Gary Gensler’s regulatory compliance concerns, efforts are underway in Congress to clarify crypto legislation.
Insights from Industry Leaders
Ophelia Snyder, president of crypto ETF provider 21 Shares AG, shared her perspectives on Bloomberg’s Tiger Money podcast, highlighting that the adoption of digital-asset funds is still in its early stages, indicating significant growth potential ahead. She aptly likened the current phase to the “early innings,” suggesting that the realm of crypto investment is just getting started.
When Will Bitcoin Make a Breakthrough?
Despite the remarkable 19-day streak of inflows into US Bitcoin ETFs, Bitcoin’s price has yet to surpass the elusive $73,679 mark. Nonetheless, speculators in the options market remain hopeful, anticipating a breakthrough in the coming month. This optimism is fueled by the increasing demand for ETFs and expectations of Federal Reserve interest-rate cuts.
Currently, Bitcoin is trading at $71,080, showing a slight uptick in its price over the past 24 hours. Despite this rise, trading volume remains relatively subdued at around $26.2 billion, with a market cap hovering around $1.4 trillion.