In a recent update on September 14, 2024, U.S. spot Bitcoin exchange-traded funds (ETFs) experienced a significant surge in inflows, totaling $263 million in net purchases in a single day. This spike in investor interest was driven by Bitcoin’s price climbing above $60,000, marking a 12% increase over the past week. Fidelity’s Bitcoin ETF (FBTC) led the way with $102 million in fresh capital, contributing to a total weekly inflow of $218 million. Following closely behind were ARK Invest and 21Shares’ Bitcoin ETF (ARKB), which saw approximately $99 million in net inflows for the day. Other Bitcoin ETFs, including those managed by companies like Bitwise, Franklin Templeton, Valkyrie, VanEck, and Grayscale, also reported positive inflows, indicating a widespread resurgence of interest in the U.S. spot Bitcoin ETF market.
Despite the overall positive trend, not all funds experienced the same level of success. BlackRock’s iShares Bitcoin Trust (IBIT) and WisdomTree’s Bitcoin Fund (BTCW) reported zero inflows on Friday, with IBIT in particular facing challenges as it saw net outflows on multiple occasions in recent weeks. However, despite this mixed performance, U.S. spot Bitcoin ETFs closed the week with over $400 million in net inflows, underscoring the overall bullish sentiment in the market. The surge in Bitcoin’s price, combined with strong ETF inflows, signals growing optimism among investors about the future of the cryptocurrency market.
Beyond the U.S., the broader cryptocurrency market also experienced gains during this period, with Bitcoin’s price rising from $54,300 at the beginning of the week to over $60,600 by Friday. Ethereum (ETH) also saw an 8% weekly increase, reaching $2,400, while altcoins like Toncoin (TON), Chainlink (LINK), and Avalanche (AVAX) were among the top performers during this time. Despite the recent rally, a report from ARK Invest highlighted that many Bitcoin ETF investors still hold positions at a loss, indicating that the average cost basis remains higher than the current market price. However, the report also emphasized that Bitcoin’s long-term fundamentals remain robust, with the MVRV Z-Score signaling bullish underlying value for the cryptocurrency.
Market speculation suggests that the recent surge in Bitcoin and other cryptocurrencies may be tied to expectations of a potential interest rate cut by the U.S. Federal Reserve. With inflation data coming in below expectations at 2.5%, many investors anticipate a rate reduction of 25-50 basis points during the Fed’s upcoming meeting on September 18. Similar moves by the European Central Bank and the Bank of Canada to ease monetary policy could further fuel optimism in the crypto market. Overall, the combination of strong ETF inflows, a positive price trend for Bitcoin, and favorable monetary policy expectations points to a continued optimistic outlook for the cryptocurrency market in the near future.
