Bitcoin spot ETFs on Nov. 7 saw a historic surge in investment, with total net inflows reaching $1.38 billion, the highest single-day figure to date.
What Happened: BlackRock's IBIT ETF alone accounted for $1.12 billion of this total, marking a record-breaking day for digital asset ETFs, according to data from SoSo Value.
Ethereum spot ETFs also saw significant activity, with net inflows of $79.7 million, representing the third-highest single-day inflow for Ethereum.
The surge in Bitcoin ETF inflows comes at a time when post-election optimism and market recalibrations are influencing investor behavior.
According to QCP Capital, recent market movements indicate that Bitcoin BTC/USD is benefiting from increased attention, driven partly by what they describe as “Trump trades.”
These are investments spurred by positive sentiment around Trump's economic policies and a 25 basis-point cut from the Federal Reserve, which have helped drive Bitcoin prices to $77,000.
“However, investors are beginning to pull back on some ‘Trump trades‘: the dollar has reversed much of its post-election gains, and Treasury yields have settled back into recent ranges,” QCP Capital noted.
The firm points out that fiscal concerns, such as the national debt and Trump's proposed 60% tariff on China, are prompting investors to reassess their portfolios.
Also Read: Bitcoin, Ethereum, Solana Rally Does Not Mean All Cryptocurrencies Will Moon: 10x Research
These factors, they suggest, could make Bitcoin's risk profile more appealing than traditional equities and potentially position it to outperform other risk-on assets.
In a note sent to Benzinga, Fadi Aboualfa, Head of Research at Copper.co, also provided insights on the significance of these ETF inflows for Bitcoin's future.
“We have back-tested the ETF accumulation trend against potential price ranges, suggesting a $100,000 Bitcoin is quite possible by the time the 47th U.S. President heads to the Capitol for inauguration on Jan. 20,” Aboualfa stated.
His analysis projects that ETFs could hold approximately 1.1 million Bitcoin by January, further reinforcing Bitcoin's appeal as an investment.
Reflecting on Trump's previous administration, Aboualfa noted, “For Bitcoin, it's worth remembering that Trump oversaw not one but two all-time high cycles during his 2016–2020 presidency.”
However, he highlighted a difference in today's market context, stating that past gains occurred against a weakening dollar backdrop, as opposed to the current stronger dollar environment.
What’s Next: These trends will be a focal point at Benzinga's Future of Digital Assets event on Nov. 19, where experts and industry leaders will explore Bitcoin's evolving role in the financial landscape amid changing economic and regulatory environments.
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© 2024 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.
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