US Bitcoin ETFs Reach Over 15 Billion in Value Yet BTC Price 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 the influx of investments, Bitcoin’s price has yet to reach its all-time high.
A remarkable trend is emerging in the realm of Bitcoin. US Spot Bitcoin exchange-traded funds (ETFs) are experiencing an unprecedented surge, with a massive $15.6 billion inflow over 19 consecutive days, bringing their total assets to a whopping $62.3 billion.
However, despite this flurry of activity in the investment world, Bitcoin’s price continues to struggle below its much-hyped peak of $73,679. What could be causing this disconnect?
Delve deeper to uncover the underlying reasons for this disparity and its implications for the future of Bitcoin.
The Rise of Bitcoin ETFs
Since their introduction, these ETFs have captured the imagination of investors, drawing an impressive $15.6 billion in total inflows and accumulating assets worth $62.3 billion. Globally, Bitcoin ETFs now hold approximately 1.3 million BTC, making up a significant 5.2% of the circulating supply.
This surge in popularity of Bitcoin ETFs, spearheaded by major players like BlackRock Inc. and Fidelity Investments, signals a notable shift in the epicenter of crypto 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, claiming the top spot as the largest fund for the token worldwide. Fidelity’s Wise Origin Bitcoin Fund, with $12.3 billion, follows closely behind.
The increase in ETF inflows coincides with regulatory changes, including the SEC’s approval of spot Bitcoin ETFs earlier in the year. This regulatory shift has not only reshaped the crypto landscape but also redirected focus from Asia to the United States.
The Crucial Role of the SEC
After greenlighting spot Bitcoin ETFs in January and spot Ethereum ETFs in May, the SEC is now reassessing regulations for the crypto industry. Despite Chair Gary Gensler’s concerns regarding regulatory compliance, efforts are being made at the congressional level to clarify crypto legislation.
Industry Insights
Ophelia Snyder, president of crypto ETF provider 21 Shares AG, shared her thoughts on Bloomberg’s Tiger Money podcast, emphasizing that the adoption of digital-asset funds is still in its early stages, hinting at significant growth potential ahead. She 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 impressive 19-day streak of inflows into US Bitcoin ETFs, Bitcoin’s price has yet to breach the elusive $73,679 mark. Nevertheless, 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 interest rate cuts by the Federal Reserve.
Currently, Bitcoin is trading at $71,080, showing a modest increase in its price over the past 24 hours. Despite this uptick, trading volume remains relatively subdued at around $26.2 billion, with a market cap hovering around $1.4 trillion.