This week, Bitcoin's price surged past $97,000, buoyed by renewed capital influx into US spot Bitcoin exchange-traded funds (ETFs). The trend points to a significant change in demand dynamics following months of stagnant trading. Notably, US spot Bitcoin ETFs have drawn nearly $1.5 billion in net inflows since the year's outset, as reported by Bloomberg ETF analyst Eric Balchunas.
On Wednesday alone, ETF buyers contributed $843.6 million in net inflows, pushing the weekly total to $1.07 billion. This influx comes after a period of lackluster activity, indicating a resurgence of interest from larger investors. Balchunas highlighted that this pattern may suggest buyers have outpaced sellers, correlating with Bitcoin's breakout from a prolonged consolidation around $88,000.
Despite the price rally, analysts remain cautious due to Bitcoin's historical performance during this period, which has often been challenging. Past trends linked to Bitcoin's four-year cycles indicate potential peaks 12 to 18 months post-halving events, raising questions about whether the current market is near its cyclical high. A broader recovery may hinge on ongoing accumulation by ETFs and digital asset treasury firms, as noted by market maker Wintermute.