The price of Bitcoin (BTC) has skyrocketed, reaching unprecedented levels above $72,000, after a week of record-breaking inflows into crypto exchange-traded products (ETPs).
According to James Butterfill, an analyst at CoinShares, crypto investment products have attracted a staggering $2.7 billion worth of inflows as of March 8. So far this year, crypto ETPs have seen inflows of $10.3 billion, almost matching the total inflows of $10.6 billion recorded throughout 2021.
Bitcoin has contributed the most to this figure, with $2.6 billion in inflows year-to-date, making up 14% of the global crypto asset under management (AUM).
Just days later, on March 11, the price of Bitcoin surged to a new all-time high of $72,900. It has since stabilized around $72,000, showing a 6.9% increase in the past week and a 29% rise in the past month, as per TradingView data.
The influx of funds into crypto ETPs has been greatly influenced by the growing investment in recently approved spot Bitcoin exchange-traded funds (ETFs) in the United States. These ETFs have already seen a total trading volume of over $110 billion since their launch on January 11.
James Seyffart, an ETF analyst at Bloomberg, highlighted that there are now five U.S. spot Bitcoin ETFs with over $2 billion in assets under management (AUM). Bitwise’s BITB fund is the most recent addition to this group.
Tony Sycamore, an analyst at IG, predicted that the ongoing rally could push Bitcoin’s price towards $80,000 in the coming months. He also mentioned that the cryptocurrency would find strong support even if there are any potential dips.
Mikkel Mørch, the founder of ARK36, a digital asset investment fund, noted that Bitcoin’s new all-time high coincided with the London Stock Exchange accepting Bitcoin and Ether exchange-traded notes. Additionally, there is an increased willingness from the UK Financial Conduct Authority to embrace new crypto-related financial products.
Mørch believes that the growing regulatory acceptance of cryptocurrencies worldwide, the upcoming halving event, and the continuous inflows into Bitcoin ETFs indicate a new era of growth and mainstream adoption for digital assets.
Overall, these factors are expected to sustain the rally and create a more resilient and diverse investment landscape for cryptocurrencies.