As a seasoned analyst with over two decades of experience in the financial markets, I have witnessed numerous bull and bear cycles, and the current state of Bitcoin is reminiscent of the early days of gold ETFs. The rapid influx of capital into Bitcoin ETFs, particularly this week, is unprecedented and a clear indication of strong demand from both retail and institutional investors.
This week, the inflow of funds into the Bitcoin exchange-traded fund surged over 580%, according to one expert, who noted that large investors (whales) are rapidly purchasing Bitcoin in a manner reminiscent of the build-up towards the 2020 market surge.
Over the past week, inflows into the 12 spot Bitcoin ETFs reached $2.13 billion, following six consecutive days of positive inflows. This marks the first time weekly inflows into Bitcoin ETFs have surpassed the $2 billion mark since March 2024.
The accumulated total of funds flowing into Bitcoin Exchange-Traded Funds (ETFs) has reached an unprecedented $20.94 billion. This significant figure is a remarkable achievement that gold ETFs took years to attain, as per Bloomberg’s Eric Balchunas. Intriguingly, Bitcoin-related products managed to achieve this milestone in less than one year.
During the week, the inflows peaked on October 14th at a staggering $555.86 million into ETFs, as reported by SoSoValue. However, by October 18th, the rate of inflow decreased noticeably, dropping to $273.71 million.
As a researcher, I’m reporting that no funds experienced outflows on the previous trading day. In fact, ARK 21Shares’ ARKB took the lead, witnessing the highest inflows among all funds under review. Here are the specific inflow figures for reference:
- ARK 21Shares’ ARKB, $109.86 million, 7-day inflow streak.
- BlackRock’s IBIT, $70.41 million, 5-day inflow streak.
- Bitwise’s BITB, $35.96 million.
- VanEck’s HODL, $23.34 million.
- Fidelity’s FBTC, $18.0 million, 6-day inflow streak.
- Invesco’s BTCO, $16.11 million.
- Franklin Templeton’s EZBC, Wisdom Tree’s BTCW, Grayscale’s GBTC and BTC, and Hashdex’s DEFI saw no flows.
Whale accumulation intensifies
This week, the increase in Bitcoin (BTC) investments suggests robust interest from both individual and institutional investors, coinciding with a notable hoarding tendency observed among large-scale investors, or “whales.
On X, as observed by Woominkyu from CryptoQuant, the Bitcoin whale ratio on trading platforms is reminiscent of levels seen in July 2020, immediately following the COVID market downturn. The graph he provided suggests that this was a period when a significant Bitcoin bull run began – implying that large investors could potentially be preparing for another extended price increase. (Refer to the chart below.)
A comparable distribution pattern was likewise noted among newer Bitcoin whales by fellow analyst and CryptoQuant CEO Ki-Young Ju, who stated in a recent post on Oct 16 that the number of new whale wallets, which have an average coin age of less than 155 days, has reached a record high of approximately 1.97 million BTC. (Refer to the following.)
Recently, newly created whale Bitcoin wallets have accumulated approximately 1.97 million Bitcoins, with each wallet holding over a thousand Bitcoins. The average age of these coins is less than 155 days, excluding those managed by exchanges and miners, suggesting they are likely custodial wallets. This year alone, the Bitcoin balance in these wallets has increased by an astounding 813%. As a result, these wallets now control around 9.3% of the total Bitcoin supply, currently valued at a staggering $132 billion.
— Ki Young Ju (@ki_young_ju) October 16, 2024
Whales are frequently nicknamed “intelligent investors” due to their tendency to purchase stocks during market declines and maintain ownership throughout market fluctuations. Utilizing their vast resources and strategic foresight, they make well-planned moves. Their actions can serve as a predictor of future market trends because they typically take advantageous positions ahead of significant price changes.
The increase in whale ownership is fueling optimism for an imminent price surge. At the same time, some market experts believe that the whale could hit a record peak in the near future, boosted by the forthcoming U.S. presidential elections, which they see as a possible trigger for growth.
As a researcher, I’ve taken note of an intriguing observation by the pseudonymous trader known as Crypto Raven. He suggests that recent polls indicate a growing likelihood of a Republican candidate, Donald Trump, winning the November elections. This potential victory, according to him, could serve as a catalyst for Bitcoin (BTC) to reach new record highs. In his own words, he expresses optimism that, if trends continue smoothly, we might even set our sights on reaching unprecedented heights, comparable to targeting the moon.
In a more optimistic outlook, Matt Hougan, the Chief Investment Officer at Bitwise, anticipates that Bitcoin could reach six-digit figures. This prediction is based not only on the upcoming elections but also on an increase in interest from institutions and various broader economic trends.
At press time, the flagship cryptocurrency was trading at $68,280, up 8.5% over the past week.
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2024-10-19 16:40