In just under two months since their public debut on January 11, the nine new spot Bitcoin exchange-traded funds (ETFs) have accumulated a staggering 300,000 Bitcoin, valued at $17 billion. These ETFs have experienced net inflows exceeding $6 billion. The Bitcoin holdings of these nine ETFs account for approximately 1.5% of the total supply of 21 million BTC. As a result of increasing demand and limited supply, the price of BTC reached a new yearly high of over $57,000 on February 27. Currently, BTC is only down 20% from its all-time high of nearly $69,000, and its market capitalization has surpassed $1.1 trillion.
The spot Bitcoin ETFs have maintained their bullish momentum, with a net inflow of over half a billion dollars on Monday, February 26. Furthermore, these ETFs achieved their highest trading volume day, reaching $2.4 billion, surpassing the previous record of $2.2 billion set on the first trading day, January 11.
Among these ETFs, BlackRock’s iShares Bitcoin Trust leads in terms of volume, with $1.29 billion, followed by Fidelity’s Wise Origin Bitcoin Fund at $576 million. While spot Bitcoin ETFs continue to witness increasing inflows, Grayscale’s Bitcoin Trust (GBTC) experienced its lowest outflow day, with just $22 million leaving the fund. This marks the third consecutive trading day of slowing net outflows for GBTC.
Since its launch, GBTC has been the only fund to consistently experience net outflows due to heavy selling of GBTC shares by FTX and other investors. By the end of January, GBTC saw withdrawals amounting to $5.64 billion. However, outflows have decreased in February, totaling $2 billion thus far. In total, $7.6 billion has exited the GBTC ETF since its conversion.
The continuous net inflows, coupled with the decline in GBTC outflows, indicate a significant market demand for spot Bitcoin ETFs. This heightened demand, combined with the diminishing Bitcoin supply as the Bitcoin halving approaches in less than two months, could potentially drive further market demand. Currently, miners add a total of 900 new BTC to the daily supply. However, spot Bitcoin ETFs are experiencing net inflows of nearly 8,000-9,000 BTC per trading day, further reducing the supply and contributing to a bullish scenario for BTC’s price.
In related news, BTC is expected to reach $55.4K next, although there have been warnings regarding the end of Bitcoin “euphoria.” Additionally, Vance Spencer, a permabull, discusses his belief that “crypto is inevitable” and explains why he has gone “all in” on the industry.