In a remarkable show of confidence, institutional investors have doubled down on Bitcoin with investment funds related to the cryptocurrency experiencing massive inflows. Recent data from CoinShares’ latest weekly report reveals that Bitcoin investment products saw a net inflow of $942 million. This surge in investment is attributed to an immediate reaction to the lower-than-expected CPI report, with a staggering 89% of the total flows occurring in the latter three trading days of the week.
The Consumer Price Index (CPI) inflation data, which showcased results below expectations, played a pivotal role in boosting market confidence. The indication that inflation in the US may be slowing has reignited investors’ faith in the market, as it opens up possibilities for the Federal Reserve to consider lowering interest rates. Lower interest rates are advantageous for the crypto market, as they encourage investors to explore more high-risk assets like Bitcoin.
The United States notably led the inflows into Bitcoin, with a significant $1 billion flowing into US Spot Bitcoin ETFs just last week. Even Grayscale’s Bitcoin Trust (GBTC), which witnessed substantial outflows amounting to over $16 billion post the ETF approval in January, experienced a notable turnaround with $18 million in inflows for the first time last week.
The trend of significant inflows into Spot Bitcoin ETFs is anticipated to persist, with Farside investors revealing a net inflow of $237.2 million on a recent date. This surge in funds indicates a positive sentiment among investors, as highlighted by the lack of outflows on the day and the considerable influx into the GBTC.
While Bitcoin observed inflows of $942 million, there was a stark absence of flows into short Bitcoin positions, further underlining the positive outlook amongst investors. Additionally, altcoins such as Solana, Chainlink, and Cardano also saw considerable inflows of $4.9 million, $3.7 million, and $1.9 million, respectively, signifying a broader interest in the crypto market beyond just Bitcoin.
With the resurgence of demand for Spot Bitcoin ETFs and the subsequent significant inflows, there is a growing belief in the continuation of Bitcoin’s bullish run. Alongside the heightened interest in these ETFs, various other factors are contributing to a positive outlook for Bitcoin’s trajectory in the near future.
Leave a Reply