12.5 Times More Bitcoin Demand Than Production: Wall Street ETFs Take the Lead
The acquisition rate of Bitcoin by Wall Street ETFs has skyrocketed, exceeding mining production by a factor of 12.5 on a daily basis. Following the SEC’s green light for Bitcoin Spot ETFs in January 2024, there was a significant increase in institutional involvement in the cryptocurrency market.
According to Anthony Pompliano, a prominent Bitcoin investor and founder of Morgan Creek Digital Assets, this newfound institutional demand is set to push the price of Bitcoin higher, potentially surpassing previous all-time highs.
Wall Street LOVES bitcoin.
They are buying up 12.5x more bitcoin per day than the network can produce.
The march to a new all-time high is underway if this continues.
I explain this on my segment with @SquawkCNBC this morning. pic.twitter.com/0zRc3RQ4hY
— Pomp 🌪 (@APompliano) February 12, 2024
Bitcoin ETF Launch Spurs Institutional Rush
Anthony Pompliano reports that the demand for Bitcoin ETFs from institutional investors is 12.5 times greater than the amount of Bitcoin produced on a daily basis. This increase in demand coincides with the cryptocurrency market’s anticipation of the impending halving event in mid-April, which will further tighten the supply-demand dynamic by halving the pace at which new Bitcoins are created.
The first Bitcoin ETF slot was approved by the SEC in early 2024, which greatly boosted institutional interest in Bitcoin. Institutional investors and ETF providers have increased their Bitcoin holdings despite an early price decline; Grayscale is leading with almost 475,000 BTC.
Bitcoin ETF Flow – 9th Feb
All data out. Strong day at $541.5m of net inflow
Invesco had an outflow, the first non-GBTC product to have an outflow day pic.twitter.com/UCFDVAaKD3
— BitMEX Research (@BitMEXResearch) February 10, 2024
Wall Street’s Affinity for Bitcoin
In a CNBC interview, Pompliano shared his insights on why institutions are increasingly embracing Bitcoin: “Bitcoin has become Wall Street’s preferred asset.” He went on to explain that cryptocurrency offers a store of value and a hedge against inflation, making it an ideal fit for institutional portfolios. Pompliano also highlighted the impressive performance of recently launched spot Bitcoin ETFs, which have collectively seen record-breaking inflows.
In just 20 days of trading, Spot Bitcoin exchange-traded funds (ETFs) have acquired an astounding $10 billion in assets under management (AUM). BlackRock, Fidelity, and Bitwise Asset Management are at the forefront of these investments.
The last three trading days the net inflow has equalled to $+1.5B.
Every day +$500M has been flowing into the markets through the Spot #Bitcoin ETFs.
That's a huge sign.
Institutions are interested, Bitcoin is getting mature, this market is going to accelerate.
— Michaël van de Poppe (@CryptoMichNL) February 13, 2024
If Bitcoin successfully breaks above the $50,000 mark, Material Indicators predicts minimal resistance to further price appreciation, potentially leading to a substantial short squeeze. An upcoming inflation report could lead to a stock market adjustment based on the report’s influence over investor confidence and economic trends.
Angel Marinov is the Managing Editor at Coinlabz. With extensive knowledge of crypto payments and blockchain use cases, Angel is a trusted source of accurate and timely information
