The Bitcoin price surges above $48,000 as ETF inflows and other factors boost the market
The Bitcoin price has reached over $48,000, driven by strong ETF inflows and several other factors. Spot Bitcoin ETFs saw inflows of $405 million on Thursday, marking the third strongest single day for these investments so far. Additionally, historical data suggests that Bitcoin tends to perform well around Chinese New Year, and experts predict that it could reach $52,000 by mid-March. Miner sell pressure has also decreased, according to on-chain data from CryptoQuant. The positive sentiment in the equity market, with the S&P 500 hitting record highs, is likely contributing to the rise in the Bitcoin price as well.
Spot Bitcoin ETFs show significant potential for ongoing demand
The launch of spot Bitcoin ETFs has been highly successful, with BlackRock and Fidelity’s offerings reaching $2 billion in assets under management (AUM) at a rapid pace. Despite a decrease in AUM for Grayscale’s GBTC, it still holds over $20 billion. Excluding GBTC, newly launched spot Bitcoin ETFs have accumulated more than $8 billion in AUM within just one month. This indicates that spot Bitcoin ETFs are likely here to stay and will continue to generate demand for BTC. While early flows have been impressive, many institutional investors are still observing and waiting to complete due diligence before entering the market.
Supply and demand shocks point towards an upward trajectory for BTC price
In April, the issuance rate to miners will be halved, resulting in lower monthly miner sell pressure. This supply shock is coinciding with a surge in demand from spot Bitcoin ETFs, creating favorable conditions for the Bitcoin price to rise further. Additionally, the expectation of interest rate cuts from the Federal Reserve later this year could provide liquidity tailwinds for Bitcoin. As a result, experts predict that the BTC price will likely test 2024 highs at $49,000 and potentially surpass $50,000 in the coming weeks.
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