Feb 09, 2024

Bitcoin ETFs See Third-Largest Inflow Day as Price Surpasses $46,000

Alt_Text: Bitcoin ETFs record third-largest inflow day as BTC price rises above $46,000.
Bitcoin ETFs record third-largest inflow day as BTC price rises above $46,000

Strong Demand for Bitcoin ETFs Despite GBTC Outflows

On Feb. 8, spot Bitcoin exchange-traded funds (ETFs) saw a significant influx of $403 million, marking the third-largest inflow to date. This surge in demand for BTC ETFs occurred even as over $100 million was withdrawn from the Grayscale Bitcoin Trust (GBTC).

Since their launch on Jan. 11, spot Bitcoin ETFs have received a total inflow of over $2.1 billion, showcasing a strong demand for BTC in the market. The recent influx of $403 million came as BTC price surpassed $46,000, reaching a new multiweek high just $2,000 shy of its yearly peak.

Leading the ETF flow chart is BlackRock iShares Bitcoin Trust (IBIT), which received an inflow of $204 million. Fidelity saw $128 million, ARK 21Shares had $86 million, and Bitwise received $60 million. The remaining seven ETFs combined received $27 million in inflows, while GBTC recorded an additional $102 million in outflows.

IBIT also made history by surpassing GBTC’s daily trading volume. However, the total trading volume for all 11 spot Bitcoin ETFs fell below $1 billion for the first time since their launch.

BlackRock Crypto Overtakes Grayscale in Trading Volume, Sign of Growing Appetite for Bitcoin ETFs

Bloomberg senior analyst Eric Balchunas has pointed out a significant achievement for BlackRock, as it has surpassed Grayscale in terms of trading volume within a short period of time. This is a noteworthy feat, as it typically takes five to 10 years for a new fund to overtake the “liquidity king” in its category.

Market experts see the positive flow of funds into Bitcoin ETFs as a clear indication of growing demand from investors. The net inflow into these ETFs has resulted in approximately $403 million, or about 8,698 BTC, being taken out of the market and moved into cold storage.

Spot Bitcoin ETFs received approval from the United States Securities and Exchange Commission on January 10th and began trading the following day. Since their launch, spot BTC ETFs have witnessed record-breaking trading volume, with over a billion dollars being traded daily. This surge in trading activity is a strong indication of the high level of interest from institutional investors.

The upcoming Bitcoin halving, which is expected to take place in less than 70 days, will see the supply of BTC cut in half from 6.25 BTC per block to 3.125 BTC. With the increasing demand from institutional investors, the reduced supply could potentially drive BTC to reach new market highs.

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