Bitcoin Price Punches Above $48,000 Amid Strong ETF Inflows, Bullish Seasonality, Fading Miner Sell Pressure, US Equity Upside
Bitcoin Price Punches Above $48,000 / Source: Dalle-3
The Bitcoin price topped $48,000 briefly on Friday for the first time since the first day following spot Bitcoin ETF launches on the 11th of January, and was last up close to 5.0% on the day.
Bitcoin (BTC) bulls have taken decisive control of the market once again in wake of a strong day of ETF inflows.
As per ETF.com, spot Bitcoin ETF inflows topped $405 million on Thursday, the third strongest single day so far.
But various other factors are also supporting the market and raising the probability of a near-term test of $50,000.
Bitcoin historically posts strong gains around the time of Chinese New Year.
Over the past 9 years, traders would have made money every time if they bought Bitcoin three days before Chinese New Year then sold ten days after, 10X Research founder and Matrixport head of research Markus Thielen argued in a note.
Thielen forecasted that Bitcoin could hit $52,000 by mid-March.
Elsewhere, CryptoQuant noted earlier this week that miner sell pressure has fallen, citing on-chain data.
And new ETF demand, lower miner sell pressure and strong seasonality come as US equity markets scale fresh record highs.
The S&P 500 burst above 5,000 this week for the first time ever, is up 1.5% this week.
Positive sentiment in the equity market has historically spilled into crypto, raising the Bitcoin price.
Spot Bitcoin ETF Inflows Just the Tip of the Iceberg
The spot Bitcoin ETF launch has been a historic success.
BlackRock and Fidelity’s ETFs were amongst the fastest in history to reach the $2 billion in assets under management (AUM).
And while its AUM has shrunk by over $6 billion, Grayscale’s GBTC still has over $20 billion in AUM.
As per Blockworks, Excluding GBTC, newly launched spot Bitcoin ETFs have north of $8 billion in AUM.
And its not even been a month yet.
Clearly, spot Bitcoin ETFs are hear to stay.
And its looking very likely they will continue to act as a source of ongoing demand for BTC.
That’s because whilst early flows have been impressive, most institutional investors are still waiting on the sidelines.
As per a Bloomberg article earlier this week, $1.3 trillion gatekeeper LPL Financial is waiting to complete due diligence on the newly launched spot Bitcoin ETFs before offering them to clients.
The inflows seen so far into BTC via spot Bitcoin ETFs could be just the tip of the iceberg.
Where Next for the BTC Price?
The new spot Bitcoin ETF demand shock comes just as the Bitcoin market is about to experience a supply shock.
In April, the issuance rate to miners will halve, lowering monthly miner sell pressure.
A dual demand and supply shock means Bitcoin price risks are tilted firmly to the upside.
And that’s not even considering the Fed will be cutting interest rates later this year, adding liquidity tailwinds.
The Bitcoin price’s next stop is likely a test of 2024 highs at $49,000.
But a push above $50,000 is looking very likely in the weeks ahead.