Bitcoin ETF trend continues

Bitcoin is on track for its longest rally in a year as new spot ETFs begin trading. Bitcoin is preparing for a repeat of the premium streak seen a year ago, supported by record-breaking ETFs. Bitcoin tested levels close to 49,000 on the first trading day of the week. If Bitcoin finishes the day higher, it will record its longest premium streak since January 2023 with a seven-day streak. Inflows to ETFs, which have been driving Bitcoin higher recently, continue. Nine new spot Bitcoin funds, which began trading on Jan. 11, have attracted more than $9 billion in investor inflows to date. Two of the funds, from BlackRock Inc. and Fidelity Investments, are ranked as the most successful ETFs in the market, Bloomberg Intelligence analysts Eric Balchunas and James Seyffart wrote in a note. Caroline Bowler, CEO of crypto platform BTC Markets Pty., said on Bloomberg Television that there are signs of “an increasing movement of institutional money into the asset class.” Grayscale Bitcoin Trust, one of the oldest funds in crypto, became an ETF on the day the new funds were launched. The excitement around ETFs led to a Bitcoin resurgence last year, briefly passing $49,000 on the day they began trading. A pullback of around $10,000 was experienced as investors waited to see how profit-taking and ETFs would fare. The subsequent recovery has put the target at $50,000, a level last seen in 2021. Optimism about the upcoming four-year Bitcoin halving in April is also weighing on crypto. The halving reduces the amount of Bitcoin miners receive to run the powerful computers that verify transactions on the blockchain. This event is generally seen as a boost to prices based on historical precedents. In addition to ETF inflows, sentiment toward Bitcoin has been “typically positive” amid the Lunar New Year holidays currently underway in Asia, Fundstrat Global Advisors wrote in a note.