Bitcoin eyes longest winning run in a year as ETFs attract inflows, Companies & Markets

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BITCOIN is flirt­ing with a win­ning run last seen a year ago, aid­ed by the record-break­ing debut of US exchange-trad­ed funds (ETFs) for the token.

The dig­i­tal asset rose about 1 per cent to US$48,436 as of 9.50 am Mon­day (Feb 12) in Sin­ga­pore, poised for a sev­enth straight dai­ly gain that would mark the longest such streak since Jan­u­ary 2023 if the advance holds, data com­piled by Bloomberg show.

Nine new spot Bit­coin funds began trad­ing in the US on Jan 11 and have attract­ed more than US$9 bil­lion of investor inflows so far. 

Two of the offer­ings, from Black­Rock and Fideli­ty Invest­ments, rank as the most suc­cess­ful ETFs launched based on assets gar­nered after a month on the mar­ket, Bloomberg Intel­li­gence ana­lysts Eric Balchu­nas and James Seyf­fart wrote in a note. 

There are indi­ca­tions of an “increas­ing move­ment of insti­tu­tion­al mon­ey into the asset class,” Car­o­line Bowler, chief exec­u­tive offi­cer at cryp­to plat­form BTC Mar­kets Pty, said on Bloomberg Television.

The more than decade-old Grayscale Bit­coin Trust, the largest port­fo­lio ded­i­cat­ed to the token, con­vert­ed into an ETF the same day the new funds went live. A more than US$6 bil­lion out­flow from the Grayscale vehi­cle has slowed. The batch of 10 ETFs have attract­ed a net US$2.8 bil­lion overall.

Hype over the ETFs fueled a Bit­coin revival last year, briefly tak­ing the token past US$49,000 on the day they began trad­ing. A mul­ti­day, US$10,000 sell­off then ensued as investors booked prof­its and wait­ed to see how the ETFs fared. 

The sub­se­quent rebound has brought US$50,000 into view, a lev­el last seen in 2021.

Opti­mism about the qua­dren­ni­al Bit­coin halv­ing due in April is also fil­ter­ing across crypto. 

Halv­ing cuts the quan­ti­ty of Bit­coin that min­ers receive for oper­at­ing the pow­er­ful com­put­ers that ver­i­fy trans­ac­tions on the blockchain. The event is often viewed a sup­port for prices based on his­tor­i­cal precedent.

Aside from ETF inflows, sen­ti­ment toward Bit­coin is “typ­i­cal­ly pos­i­tive” dur­ing the Lunar New Year hol­i­days that are cur­rent­ly under­way in Asia, Fund­strat Glob­al Advi­sors wrote in a note.

Bit­coin remains about US$20,000 below the record high the token hit in 2021, dur­ing a pan­dem­ic-era bull run oiled by easy mon­ey. BLOOMBERG

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