- SUMMARY
The recent surge in Bitcoin’s price has been puzzling, given that major Bitcoin ETFs have seen negative flows.
However, analysis reveals that other factors are driving the rally.
Grayscale Bitcoin Trust (GBTC) has been significantly draining its Bitcoin holdings, reaching 45% depletion in 48 days.
This unprecedented selloff will lead to a complete depletion of its acquired Bitcoin within four weeks.
On the other hand, iBit is seeing a large inflow of Bitcoin, nearly equal to the amount GBTC has offloaded.
This convergence is expected to occur soon, with Black Rock absorbing all of GBTC’s recent outflows.
Despite the ETF flows, other indicators suggest a bullish sentiment for Bitcoin.
Exchanges are seeing Bitcoin outflows, indicating accumulation by retail investors who missed the earlier surge.
Notably, “Mr 100,” a mysterious entity, continues to stack Bitcoin daily.
Countries like Argentina, facing severe inflation, are turning to Bitcoin as a safe haven, leading to a surge in demand.
On-chain data shows that the Bitcoin supply on exchanges is reaching four-year lows, indicating a tightening supply.
The miner revenue is also at an all-time high.
Financial institutions like Standard Charter forecast a Bitcoin price target of $200,000 to $250,000 by 2025 due to the limited supply and increasing institutional demand.
Short-term ETF volume has been weak, with low inflows from Fidelity and Black Rock.
However, high volume and low price suggest potential arbitrage activity by trading bots and hedge funds.
Despite the recent selloff, the price of Bitcoin remains relatively strong due to the combination of retail FOMO, accumulating “Mr 100,” institutional demand, and a shrinking supply on exchanges.
The downturn in ETF flows is not currently expected to reverse the positive trend.
- Key Takeaways
Grayscale selling fuels iBit buying
Grayscale’s depletion of Bitcoin reserves is being absorbed by iBit’s inflows, with Black Rock anticipated to acquire all of GBTC’s recent outflows.
Multiple factors supporting Bitcoin price
Despite ETF outflows, indicators such as retail accumulation, Mr. 100’s purchases, and a shrinking supply on exchanges suggest bullish sentiment.
Financial institutions optimistic on Bitcoin
Institutions like Standard Charter are forecasting significant price targets for Bitcoin, driven by limited supply and growing institutional interest.