In less than two months since their public debut on January 11, the nine new spot Bitcoin exchange-traded funds (ETFs) have accumulated an impressive 300,000 Bitcoin, valued at $17 billion. These ETFs have seen net inflows surpassing $6 billion, highlighting the growing demand for Bitcoin. The BTC holdings of these ETFs account for almost 1.5% of Bitcoin’s total supply of 21 million BTC. With limited supply and increasing demand, the price of BTC reached a new yearly high of over $57,000 on February 27. Currently, BTC is only 20% away from its all-time high of nearly $69,000, and its market cap has exceeded $1.1 trillion.
The bullish momentum of the spot Bitcoin ETFs continues, with over half a billion dollars in net inflow on February 26. Furthermore, the ETFs experienced their highest trading volume day to date, with a record-breaking $2.4 billion. This surpasses the previous record set on the first trading day, January 11, which saw $2.2 billion in trading volume.
Among the spot Bitcoin ETFs, BlackRock’s iShares Bitcoin Trust leads the volume charts with $1.29 billion, followed by Fidelity’s Wise Origin Bitcoin Fund with $576 million. While the inflows into spot Bitcoin ETFs continue to reach new highs, Grayscale’s Bitcoin Trust (GBTC) has experienced its lowest outflow day, with only $22 million leaving the fund. This marks the third consecutive trading day of decreasing net outflows for GBTC.
GBTC stands out as the only fund that has consistently experienced net outflows since its launch, largely due to heavy selling of GBTC shares by FTX and other investors. By the end of January, GBTC had seen withdrawals of $5.64 billion. However, outflows have decreased in February, totaling $2 billion so far. Since its conversion, a total of $7.6 billion has exited the GBTC ETF.
The continuous net inflows into spot Bitcoin ETFs, coupled with the decline in GBTC outflows, indicate a significant market demand for these ETFs. This demand could further contribute to the scarcity of Bitcoin, especially with the Bitcoin halving expected in less than two months.
Currently, miners add a total of 900 new BTC to the daily supply. However, spot Bitcoin ETFs are witnessing net inflows of approximately 8,000 to 9,000 BTC each trading day. This further diminishes the supply of Bitcoin as demand continues to grow. This bullish scenario for the price of BTC suggests that the price could reach $55.4K in the near future.
In light of the increasing demand for Bitcoin, Vance Spencer, a prominent figure in the cryptocurrency industry, believes that “crypto is inevitable.” He has expressed his optimism by going “all in” on the crypto market.