Bitcoin Dips Spark Buying Spree in Spot Bitcoin ETFs
The recent dip in Bitcoin’s price, falling below $54,000 on July 4th, triggered a surge of investment into US-based Spot Bitcoin exchange-traded funds (ETFs). This surge represents a significant buying opportunity for institutional investors and large-scale traders seeking to accumulate Bitcoin (BTC) at a discount.
Data from Farside Investors reveals that these Spot Bitcoin ETFs experienced their largest net inflows in a month, with a collective total of $143.1 million flowing into the market on July 6th. This influx highlights the growing interest in Bitcoin as an investable asset class, particularly during periods of price volatility.
The Fidelity Wise Origin Bitcoin Fund (FBTC) emerged as the top recipient of new capital, attracting a staggering $117 million in inflows. Other notable performers included the Bitwise Bitcoin ETF (BITB) with $30.2 million, the ARK 21Shares Bitcoin ETF (ARKB) with $11.3 million, and the VanEck Bitcoin Trust (HODL) with $12.8 million.
While other Spot Bitcoin ETFs witnessed significant inflows, the Grayscale Bitcoin Trust (GBTC) experienced a contrasting trend. GBTC saw a net outflow of $28.6 million, potentially reflecting a difference in investment strategies or a preference for newer ETF options.
The substantial inflows into Spot Bitcoin ETFs suggest a strategic move by institutional investors and large-scale buyers. This strategy capitalizes on the recent price dip, allowing them to accumulate Bitcoin at potentially undervalued levels.
Hunter Horsley, CEO of Bitwise Asset Management, emphasized the efficiency of his team’s operations, acquiring Bitcoin at a minimal cost. He further expressed a bullish outlook on Bitcoin, suggesting that the current market conditions present a valuable buying opportunity for both new and existing investors. “The outlook for Bitcoin has never been stronger,” Horsley stated. “For many who don’t yet have exposure, this week is a chance to buy the dip.”
~$30,000,000 inflows into $BITB today. Bitwise PM team efficiently purchased Bitcoin at less than half of 1 basis point of cost.Cumulatively this week $BITB had >$66,000,000 of inflows, and now holds over 38,000 Bitcoin for investors.The outlook for Bitcoin has never been…
— Hunter Horsley (@HHorsley) July 5, 2024
Renowned Bitcoin critic Peter Schiff offered his perspective on the behavior of Bitcoin ETF investors. Despite the recent market volatility, Schiff observed a surprising level of resilience. These investors appear to be holding onto their assets, showing no signs of panic selling. “So far, there’s no sign of panic,” Schiff commented. However, he predicted that a larger price drop could trigger a capitulation event, leading to significant selling from these investors.
Adding another layer of intrigue to the recent price movements, the collapsed Japanese crypto exchange Mt. Gox transferred a significant amount of Bitcoin on July 6th. This transaction, totaling 47,229 BTC (worth approximately $2.71 billion), marked the first major movement of funds from Mt. Gox since May. The potential impact of these funds re-entering the market remains uncertain.