Investor confidence in Bitcoin (BTC) is on the rise due to the growing popularity of spot BTC exchange-traded funds (ETFs) and favorable market conditions. Researchers at Bitfinex believe that Bitcoin has reached a bottom price of around $60,000 after analyzing weekly market trends.
The recent Bitfinex Alpha report identified three key factors that support this belief. Firstly, there have been consistent high daily closes, indicating stability in the market. Secondly, there has been a significant outflow of BTC from crypto exchanges, suggesting that investors are holding onto their assets rather than selling them. Lastly, there has been a notable increase in inflows into the spot Bitcoin ETF market, indicating growing interest in BTC investments.
Despite the large outflows from exchanges on May 15, which saw 55,000 BTC being withdrawn, Bitcoin’s price remained stable above $61,000. This demonstrates that the market sentiment remains positive, even in the face of significant outflows. In fact, last week alone, BTC outflows amounted to $3.85 billion.
Additionally, the spot Bitcoin ETF market in the United States has seen seven consecutive days of net positive inflows. While the Grayscale Bitcoin Trust (GBTC) has historically been responsible for most outflows, it has recorded net positive inflows in six out of the past seven days. This suggests that ETF buyers are now acquiring BTC at a similar cost basis of around $62,000, excluding GBTC.
Investors who prefer diversifying their portfolios at a lower cost and with tax benefits often choose to invest in ETFs. This allows them to gain exposure to Bitcoin without directly owning the cryptocurrency.
In terms of institutional investments, BlackRock’s iShares Bitcoin Trust (IBIT) has attracted nearly $16 billion, making it the most popular Bitcoin ETF. JPMorgan Chase has also disclosed investments in Bitcoin ETFs offered by various providers, including Grayscale, ProShares, Bitwise, BlackRock, and Fidelity.
It’s worth noting that the information provided by JPMorgan Chase regarding its investments should not be assumed to be completely accurate, according to the SEC.
In conclusion, the bullish sentiment surrounding Bitcoin investments is driven by the increasing popularity of spot BTC ETFs and favorable market conditions. Bitcoin has shown resilience despite significant outflows from exchanges, and the spot Bitcoin ETF market has seen consistent inflows. This indicates growing interest and confidence in BTC investments.