Key Points
- Last week, Bitcoin investment products witnessed over $1 billion inflows, taking the year-to-date total to roughly $14.6 billion.
- Increased exposure to spot Bitcoin ETFs by institutions and long-term investors is largely driving this investment surge.
Investment inflows into Bitcoin (BTC) surpassed $1 billion in the past week, pushing the total inflows for the year to nearly $14.6 billion. This surge is primarily due to institutional and long-term investors expanding their exposure to spot Bitcoin ETFs.
Record Inflows into Crypto Investment Products
In the week that ended on May 24, Bitcoin exchange-traded products (ETPs) recorded $1.01 billion in inflows. The total inflows for all cryptocurrency investment products hit $1.05 billion, setting a new all-time high of $14.9 billion for 2024 to date.
The “Digital Asset Fund Flows Weekly” report, published on May 28, showed a 28% increase in weekly trading volumes, reaching $13.6 billion. The total assets managed by crypto funds now stand at $98.43 billion.
Bitcoin and Ethereum ETFs Driving Market
The recent buying surge and price increases are mainly fueled by the market’s anticipation of spot Ethereum ETFs approval in the United States. Despite Bitcoin’s underperformance compared to Ether post-approval, the continued inflows into spot Bitcoin ETFs are seen as significant.
According to data from Farside Investors, institutions invested nearly $1.057 billion in spot Bitcoin ETFs between May 20 and May 24. Meanwhile, outflows from Grayscale’s IBIT decreased significantly to just $20.5 million for the week.
Bitcoin Price Remains Range-Bound
Analyst Daan Crypto Trades noted that Bitcoin’s price action over the last several months has been within a wide range, stretching from $59,095 to the March 14 all-time high above $73,800.
Meanwhile, Rekt Capital observed that Bitcoin’s recent recovery above $70,000 formed “another local top.” He predicts Bitcoin will likely continue consolidating between $60,000 and $70,000.
Institutional and Long-Term Investors Accumulate Bitcoin
Institutional and long-term investors are taking advantage of Bitcoin’s low volatility to increase their holdings. Glassnode’s “The Week On-chain” report, published on May 28, indicated that long-term investors are re-accumulating coins for the first time since December 2023.
Glassnode analysts found that the aggregate supply from long-term holders (LTHs) has dropped by 12,000 BTC to 85,800 BTC/month. This is a significant decrease from a peak of 519,000 BTC/month in late March, signaling a “cooling-off period” and a return to accumulation patterns.
Trader and analyst Ali Martinez also noted increased buying activity by whales in recent days, further supporting the accumulation trend.