Since the approval of the Bitcoin spot ETF in early 2024, ETF fund holdings have steadily increased, driving a significant price surge. Capital inflows through ETFs have become a key catalyst for Bitcoin’s market performance, pushing the price to an all-time high of $108K by the end of 2024.
The pro-crypto policies of the Trump administration, set to take effect on January 20, 2025, could provide additional tailwinds for the market. Regulatory easing and a crypto-friendly environment in the U.S. are likely to attract greater institutional participation, further boosting interest and inflows into Bitcoin ETFs. This development is expected to have a positive impact on Bitcoin’s long-term growth trajectory.
However, one point of caution remains: if ETF inflows slow or decrease, Bitcoin’s upward momentum could weaken. As seen in Q2 2024, a temporary slowdown in ETF inflows coincided with a period of price stagnation. If a similar trend emerges in 2025, short-term corrections in Bitcoin's price cannot be ruled out.
By monitoring ETF inflow trends and macroeconomic developments, investors can better navigate the market’s dynamics. While the outlook for Bitcoin breaking new records remains promising, a cautious approach is advised to account for potential volatility.
Written by Yonsei_dent
