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Bitcoin spot ETFs have attracted over $1 billion in net inflows in the past one week, highest since July. An expert said it's evidence institutional investors have become increasingly receptive to digital assets.
This surge in investment comes as Bitcoin's price lingers around the $64,000 mark, despite a slight dip in early Monday trading.
BlackRock's Ethereum ETF (ETHA) led with an inflow of $94.9 million, followed by Fidelity's Ethereum ETF (FETH) with $64.9 million. This positive movement came despite an outflow of $127 million from Grayscale's ETF (ETHE), suggesting a redirection of investor capital into newer products, data from SoSo Value shows.
Source: CoinShares
The robust inflows into Bitcoin ETFs have not gone unnoticed by industry experts. Avinash Shekhar, Co-founder and CEO of Pi42, an Indian crypto derivatives platform, told Decrypt that the surge in net inflows for spot Bitcoin ETFs, reflects a strong resurgence of investor confidence, particularly following the Federal Reserve's interest rate cut.
Shekhar also noted the renewed interest in Ethereum ETFs, which recorded their second-best week since launch.
“The trends we are observing indicate that the market is increasingly receptive to digital assets, suggesting promising opportunities for both Bitcoin and Ethereum moving forward," he said.
The influx of capital into Bitcoin-based financial products apparently indicates a growing confidence in the cryptocurrency market amid macroeconomic developments, particularly in Japan, which is planning to review its cryptocurrency regulations, which could lead to reduced taxes on digital assets and potentially facilitate the launch of domestic funds that invest in tokens, according to a Bloomberg report.
As of early Monday morning European hours, Bitcoin (BTC) was trading at $63,880, down approximately 2.8% from previous levels. Ethereum (ETH), the second-largest cryptocurrency by market capitalization, also experienced a modest decline, trading at $2,630, a 0.7% decrease, according to data from CoinGecko.
Data from crypto asset manager CoinShares further supports this bullish sentiment. The firm reported that digital asset investment products saw a third consecutive week of inflows totaling $1.2 billion. This trend is attributed to expectations of dovish monetary policy in the U.S. and positive price momentum, with total assets under management rising by 6.2% last week.
Interestingly, while Bitcoin dominated the inflows, Ethereum also broke its 5-week negative streak with inflows of $87 million, marking its first significant influx since early August. Altcoins experienced mixed reactions, with Litecoin (LTC) and (XRP) receiving inflows of $2 million and $0.8 million respectively, while Binance and Stacks (STX) faced outflows of $1.2 million and $0.9 million respectively.
Meanwhile, data from CryptoQuant indicates that the Bitcoin supply in profit has maintained a high level, which historically signifies a bullish market trend. Typically, Bitcoin's supply in profit remains above 80% during bull cycles.
While there have been brief moments of it dipping below 80%, these dips often present buying opportunities. The recent summer fluctuations briefly pushed the supply in profit below this threshold multiple times, but investors utilized these instances as buying opportunities, supporting the bull cycle narrative, analysts at CryptoQuant stated.
Edited by Stacy Elliott.
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