Record-Breaking Bitcoin ETFs: 14,261 BTC Purchased in a Day, Paving the Way for a Price Surge
Bitcoin Exchange-Traded Funds (ETFs) had an extraordinary trading day on March 12, as they saw a record-breaking purchase of 14,261 bitcoins. This not only surpassed the initial excitement of the ETFs’ launch but also set a new high for market engagement. The calculation of these Bitcoin purchases involves dividing the daily monetary inflow by the average price of Bitcoin, highlighting the significant role of ETFs in the market.
After experiencing a decline in inflows that coincided with a decrease in Bitcoin’s price, the ETFs have shown a strong recovery. Current trends indicate not only a rebound but also a continuous increase in investments. This surge in demand for Bitcoin through ETFs, combined with the daily new supply from mining, which is approximately 900 bitcoins, is contributing to an upward movement in Bitcoin prices. This gap is expected to widen further with the upcoming Bitcoin halving event, which will reduce the daily mining output to 450 bitcoins.
In a LinkedIn post on March 14, Clive Thompson, a former managing director of wealth management with a background in Swiss Private Banking, pointed out a potential connection between the increase in Bitcoin holdings by ETFs and the rise in the cryptocurrency’s price. This suggests that ETF activities could play a crucial role in Bitcoin’s market movements. Despite price fluctuations, Bitcoin’s overall trend remains positive, supported by a high Cryptocurrency Fear and Greed Index of 91, indicating a strong market sentiment.
The current market is driven by two main factors: the anticipation of the Bitcoin halving event, which is expected to initiate the next bull cycle, and the continuous interest in ETFs. The introduction of Bitcoin ETFs has been particularly significant, attracting institutional investment and increasing the mainstream appeal of the cryptocurrency.
According to Kaiko Research, the liquidity depth in the Bitcoin market has reached a new high, with a notable imbalance between bids and asks in order books, suggesting a trend of traders taking profits. However, high refinancing rates indicate sustained demand for Bitcoin.
The growing interest in spot Bitcoin ETFs, from both institutional and retail investors, is making a noticeable impact. With Bitcoin ETFs approaching $60 billion in assets under management (AUM) and rapidly closing the gap with Gold ETFs, which have about $98 billion, the momentum suggests a potential shift in investment preferences. Eric Balchunas from Bloomberg Intelligence predicts that all 10 Bitcoin ETFs are likely to surpass Gold ETFs in AUM. Even the lowest-ranked among them, WisdomTree’s BTCW, already manages $74 million, placing it in the top 15% of the 108 ETFs launched in 2024, indicating strong market acceptance and growth potential for Bitcoin ETFs.
