The Zhitong Finance App learned that last week, as Bitcoin prices soared, spot Bitcoin ETFs ushered in the strongest weekly inflow in 10 months. According to the data, 13 funds listed in the US had a net inflow of 1.92 billion US dollars, the highest since the beginning of October last year. This wave of capital inflows comes at a time when Bitcoin rose about 23% last week, the biggest weekly increase in more than three years. Bitcoin traded at around $77,000 in Singapore at noon in the Asian session on Monday.
Bitcoin's astonishing rise was initially driven by US plans to increase long-term bond buybacks to reduce yields, then shorting intensified the rally as traders were forced to close short positions. The surge in ETF inflows shows that investors are more in demand for Bitcoin.
“We saw a net inflow of capital on every trading day last week, which shows a rekindled investor interest in Bitcoin,” said Gracie Lin, CEO of cryptocurrency exchange OKX SG. “The question now is whether this trend can continue. After Bitcoin experienced such a strong rise, it's not surprising that there was some return in profits.”
ETF capital inflows in the latest week hit a record high since Bitcoin plummeted from an all-time high of over $126,000 on October 6 last year and entered the so-called “cryptocurrency winter.” Notably, spot ETFs experienced a net outflow of nearly $390 million in the previous week, the biggest in six weeks.
Last week, BlackRock's iShares Bitcoin Trust Fund attracted $1.3 billion in capital inflows. Even so, Bitcoin ETF funds have evaporated around $2.9 billion since this year. Whether Bitcoin's rise translates into continued demand and a new bull market is yet to be seen.
“In the short term, the market seems to have expanded excessively, but there is still good support,” said Jayke Kyndrede, a senior sales trader at market maker QCP Group. “After such a rapid rise, it is not surprising that there has been some consolidation or pullback, but with demand still strong, it is difficult to predict the timing and depth of the pullback.”