Bitcoin ETFs Achieve $870 Million in Record Inflows Amid Price Surge

US spot Bitcoin exchange-traded funds (ETFs) experienced a record $870 million in daily inflows, with a total trading volume exceeding $5 billion on a day when Bitcoin approached its all-time high.

Record Inflows and Trading Volume for Bitcoin ETFs

On Tuesday, US spot Bitcoin ETFs achieved remarkable trading activity, garnering a total of $5 billion in trading volume while witnessing inflows exceeding $870 million. This influx signals heightened investor interest as Bitcoin itself neared its previous peak value. Among the leaders in this surge was BlackRock’s iShares Bitcoin Trust (IBIT), which accounted for a staggering $3.3 billion in trading volume—its second-highest figure ever recorded. This performance was complemented by significant inflows into the fund, which reached approximately $642 million.

Following closely was Fidelity’s Wise Origin Bitcoin Fund (FBTC), which also reported substantial activity with $133 million in inflows and a trading volume of around $549 million. Meanwhile, the Grayscale Bitcoin Trust (GBTC) diverged from the trend, experiencing outflows of $17.3 million against a trading volume of about $390 million. Overall, the robust activity in Bitcoin ETFs underscored a strong demand for Bitcoin, with total net inflows for October now reaching an impressive $5 billion.

Demand Dynamics and Market Trends

Ecoinometrics, in its latest newsletter, emphasized the significance of how many bitcoins these ETFs accumulate over time, highlighting the importance of demand pressure in this context. The current demand pressure is reportedly the strongest seen since March, and analysts suggest that this trend has been a key driver behind Bitcoin’s recent price increases over the past year.

As ETF inflows continue to rise, there appears to be a nuanced understanding of market dynamics. Checkmate, a pseudonymous analyst, noted that despite increasing ETF inflows, the CME open interest had not seen a substantial increase, indicating a shift in trading behavior. According to Checkmate, this suggests a more genuine directional flow into ETFs rather than speculative cash-and-carry trades. This observation points to a growing confidence among investors in the potential of Bitcoin ETFs.

Performance of Competing Bitcoin ETFs

In addition to IBIT and FBTC, other Bitcoin ETFs also recorded positive inflows on Tuesday. Bitwise’s BITB garnered approximately $52.49 million, while VanEck’s HODL and Ark Invest’s ARKB saw inflows of $16.52 million and $12.39 million, respectively. However, five other spot Bitcoin ETFs reported no inflows, indicating a selective investor interest among available options.

The surge in trading volume for Bitcoin ETFs was noteworthy, increasing to $4.75 billion on Tuesday compared to $3 billion the previous day. Eric Balchunas, a senior analyst at Bloomberg ETF, remarked on the unusual spike in IBIT’s trading volume, attributing it to a potential “FOMO-ing frenzy” among investors reacting to recent price increases. He noted that typically, ETF trading volumes surge during downturns, suggesting that the current market dynamics are somewhat atypical.

Bitcoin Price Movements and Ethereum ETF Activity

As of the reporting period, Bitcoin was trading at approximately $72,376, a slight decline from an intraday high of $73,544, which positioned it just below its all-time high of $73,738. In the last 24 hours, Bitcoin’s trading volume reached over $53 billion, reflecting a robust trading environment. Ether also saw a positive movement, climbing 1.02% to trade at $2,643.

The activity was not limited to Bitcoin, as spot Ethereum ETFs in the US also reported significant inflows on the same day. These ETFs recorded $7.65 million in daily net inflows, with BlackRock’s ETHA being the only ether ETF to see positive flows, attracting $13.62 million. In contrast, Grayscale’s ETHE faced net outflows of $5.97 million, while the remaining seven Ethereum ETFs experienced no flows. The total trading volume for Ethereum ETFs increased to $280.55 million, up from $187.49 million the day prior.

Future Projections and Market Outlook

According to Balchunas, US spot Bitcoin ETFs are on track to surpass the holdings of Bitcoin’s creator, Satoshi Nakamoto, by the end of the year. Currently accumulating approximately 17,000 BTC weekly, these ETFs are projected to exceed 1 million BTC next week, potentially overtaking Nakamoto’s estimated 1.1 million BTC by December. Despite market volatility that could