BlackRock reportedly bought a staggering 11,500 Bitcoin from the available supply during the recent decline since launching its spot Bitcoin ETF.
This amount is significant considering that only 900 BTC is issued daily. BlackRock's purchase effectively represents about 13 days' worth of Bitcoin production absorbed by a single player.
BlackRock iBIT Bitcoin and Cash Holdings (Source)
The asset manager's CEO, Larry Fink, recently said that his views on Bitcoin have evolved significantly over the years and he now sees it as a “viable asset class.”
Supply shortage
According to the data, the iShares Bitcoin Trust (IBIT) Spot ETF managed only about 25% of trading volume over the same two-day period. This suggests that around 46,000 BTC have been removed from the system in the last two days, influenced by other actors such as Grayscale Bitcoin Trust (GBTC).
If this trend continues, the Bitcoin market could experience a serious supply shortage. Since an estimated 46,000 BTC are absorbed in two days, which is 23,000 BTC per day, this rate is approximately 25.5 times the daily Bitcoin production.
Strong adoption of US ETFs, not to mention additional demand from retail investors and other global ETFs, suggests a tightening of available Bitcoin supply.
Despite the fluctuations in Bitcoin price, the underlying asset remains resilient. Despite the high fees associated with GBTC, the successful launch of the Bitcoin ETF is a strong sign of growing institutional interest. It could usher in a new era of scarcity in the Bitcoin market.
ETF inflows reached $819 million
The first two trading sessions following the approval of new Bitcoin exchange-traded funds (ETFs) saw significant inflows totaling $1.4 billion. After accounting for outflows from GBTC, the total net inflows of all Bitcoin-related products amounted to $819 million.
A breakdown of this activity shows a notable volume of 500,000 individual trades, contributing to a total trading volume of $3.6 billion. BlackRock's iShares Bitcoin Trust (IBIT) led this initial surge, bringing in $497.7 million in total inflows.
The Fidelity Advantage Bitcoin ETF (FBTC) was close behind, raising $422.3 million. Bitwise (BITB) also had a significant impact, attracting $237.90 million in investments.
In contrast, the Grayscale Bitcoin Trust (GBTC), an existing product, saw an outflow of $579 million over the same period. This shift is partly due to investors opting for the new Bitcoin ETFs with lower fees.
This trend is in line with previous predictions from ETF analysts, who estimated that Bitcoin ETFs could attract around $10 billion in their first year of operation. It is worth noting that GBTC is one of the largest Bitcoin holders, managing over $27 billion.
BTC price and market data
At press time, Bitcoin is ranked #1 in terms of market capitalization, and so is the BTC price high 0.06% in the last 24 hours. BTC has a market capitalization of $840.62 billion with a 24-hour trading volume of $21.04 billion. Learn more about BTC ›
BTCUSD chart from TradingView
Market overview
At press time, the global cryptocurrency market is valued at at $1.69 trillion with a 24-hour volume of $55.15 billion. Bitcoin dominance is currently at 49.68%. Find out more >
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