Bitcoin Reaches Near $44,000 Mark with ETFs Experiencing Weekly Net Inflows After a Week
Bitcoin ETFs experienced a notable turnaround on Monday, registering their first net inflows in a week, driving bitcoin prices to their highest level since the commencement of trading. Despite continued net outflows at the Grayscale Bitcoin Trust (GBTC), ETF issuers collectively added over 4,200 bitcoin to their portfolios, valued at approximately $183 million.
In the preceding week, daily flows consistently showed negative trends, with around 20,000 bitcoin exiting the funds from Jan. 23 to Jan. 26. The last instance of net inflow occurred on Jan. 22, when the spot funds collectively incorporated just over 1,200 bitcoin.
The price of bitcoin, which had dipped below $39,000 due to increased selling pressure last week, rebounded, reaching a peak of $43,900 on Monday. As of press time, it is trading at $43,500, marking a commendable 10% increase from levels observed a week ago.
Despite the sustained outflows at GBTC since the ETFs’ launch, the pace has gradually diminished. The fund witnessed an average outflow of $470 million in the initial six days post the spot ETFs’ debut. On Monday, this figure decreased to $192 million, as reported by research firm BitMEX.
In the first 12 trading days since receiving approval on Jan. 10, the newly introduced ETFs have accumulated total net inflows surpassing $1 billion, according to BitMEX’s findings. This positive momentum indicates a growing investor interest in bitcoin, despite the recent market fluctuations.
In conclusion, the recent surge in bitcoin prices, coupled with the positive net inflows in ETFs, reflects a renewed investor confidence. The market resilience demonstrated amid challenges highlights the cryptocurrency’s enduring appeal and potential for sustained growth.
“This data underscores considerably stronger profitability in the mining sector compared to challenges experienced in 2022 and part of 2023.”
In approximately six months, Bitcoin undergo a “halving,” reducing the new bitcoins awarded to miners by half. Satoshi Nakamoto introduced this event in 2009 as an anti-inflationary measure. Occurring roughly every four years, the lead-up to halvings traditionally proves the most profitable time for crypto investors. “Buying bitcoin six months before a halving and selling 18 months after has historically outperformed a ‘buy and hold’ strategy,” affirms the analyst.
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