Spot Bitcoin ETFs Experience Largest Inflows in Nearly a Month with $129 Million Surge

Spot Bitcoin ETFs Experience Largest Inflows in Nearly a Month with $129 Million Surge

Spot Bitcoin exchange-traded funds (ETFs) recorded substantial inflows on Monday, attracting $129.45 million in daily net investments. This marks the fifth consecutive day of positive flows and represents the highest level of fund intake since June 7, according to data from SosoValue.

Leading the Pack: Fidelity’s FBTC and Bitwise’s BITB

Fidelity’s FBTC led Monday’s inflows with $65 million, followed closely by Bitwise’s BITB, which saw $41 million in net investments. Other significant contributors included Ark Invest and 21Shares’ ARKB with $13 million in inflows. Invesco, Galaxy Digital, VanEck, and Franklin Templeton also reported smaller inflows, ranging from around $5 million to under $5 million each.

Notable Absences: BlackRock’s IBIT and Grayscale’s GBTC

Despite the overall positive trend, the two largest spot Bitcoin ETFs by net asset value, BlackRock’s IBIT and Grayscale’s GBTC, did not report any inflows on Monday. Collectively, these 11 Bitcoin funds generated approximately $1.36 billion in trading volume for the day. Since their inception in January, the ETFs have amassed total net inflows of $14.65 billion.

Digital Asset Investment Products Face Continued Outflows

In contrast, digital asset investment products experienced outflows for the third consecutive week, totaling $30 million. However, the rate of outflows has decreased significantly compared to previous weeks, according to a recent report by CoinShares. Grayscale reported the largest outflows at $153 million, while other providers saw minor inflows.

Increased Trading Volumes and Geographic Trends

Trading volumes for digital asset investment products increased by 43% week-on-week, reaching $6.2 billion, although this is still below the average weekly volume of $14.2 billion for the year. Geographically, the United States, Brazil, and Australia experienced inflows of $43 million, $7.6 million, and $3 million, respectively. Conversely, Germany, Hong Kong, Canada, and Switzerland saw outflows of $29 million, $23 million, $14 million, and $13 million, respectively.

Ethereum Faces Significant Outflows

Ethereum witnessed its largest outflows since August 2022, with $61 million withdrawn in the past week, bringing its total outflows for the last two weeks to $119 million. This makes Ethereum the worst-performing asset in terms of net flows year-to-date. In contrast, multi-asset and Bitcoin exchange-traded products (ETPs) saw inflows of $18 million and $10 million, respectively, while short-bitcoin ETPs experienced outflows of $4.2 million, indicating a potential shift in market sentiment. Several altcoins, including Solana and Litecoin, also saw notable inflows.

Analysts Predict Bullish Trend for Bitcoin in July

Analysts at QCP Capital suggest that both Bitcoin and Ether historically perform well in July due to positive seasonality. “Looking at seasonality, BTC has a median return of 9.6% in July and tends to bounce back strongly especially after a negative June (-9.85%),” they noted in a recent Telegram post. The firm’s options desk observed positioning for an upside move last Friday into the month-end, possibly in anticipation of the ETH spot ETF launch, pointing to a bullish July.

Potential Trade Strategy: BTC Accumulator

QCP Capital proposed a trade strategy involving a BTC Accumulator with an expiry of September 20, 2024, spanning 12 weeks. This strategy involves buying BTC below the $60,000 mark, taking advantage of the expected bullish momentum in the coming month. The strike price is set at $59,000, with a barrier at $71,000, capping the trade if BTC surpasses that threshold.

The recent inflows into spot Bitcoin ETFs and the bullish outlook from analysts suggest a positive trend for Bitcoin in the upcoming month, indicating renewed investor confidence and market optimism.

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