News
Bitcoin Hovers Around $57K Amid Spot ETF Inflows
Key points
- Cryptocurrency prices have remained mostly stable over the past 24 hours, with bitcoin hovering around $57,000.
- Inflows of about $295 million into spot bitcoin ETFs on Monday may have stabilized bitcoin prices.
- Germany continued to sell off seized bitcoin, sending $362.12 million to exchanges and brokers in the space of three hours on Tuesday.
- Market watchers will be looking for signs of a rate cut during Federal Reserve Chairman Jerome Powell’s testimony before Congress on Tuesday and Wednesday.
Bitcoin (BTC) the price is holding steady around $57,000 on Tuesday, perhaps because it is strong bitcoin spot exchange traded funds (ETFs) The inflows offset the price weakness caused by the selling of the cryptocurrency by large investors.
Despite More Record Highs for the S&P 500 and Nasdaq Bitcoin was far from its all-time high in March on Monday, although it has gained about 6.5% from last week’s low.
Spot Bitcoin ETF Inflows Continued Price Weakness
Spot bitcoin ETFs saw net inflows of nearly $295 million on Monday. That may not seem like a big number, but it’s significant because it’s more than the combined net inflows for these products over the past two weeks, according to data from Farside Investors.
BlackRock’s iShares Bitcoin Fund (IBITS) was the biggest gainer on flows on Monday, earning $187 million, followed by Fidelity’s Fidelity Wise Origin Bitcoin Fund (FBTC), which received approximately $62 million in inflows.
Inflows into new spot bitcoin ETFs have been credited with creating demand for bitcoin since they began trading in January, which in in turn fueled a massive rally Bitcoin prices hit an all-time high of over $73,000 in March.
Likewise, Monday’s inflows may have helped offset some of the price weakness in Bitcoin attributed to selling pressure from large investors.
Germany Continues to Sell Bitcoin
Germany continued to sell bitcoin which was previously seized from an online piracy website. According to Arkham Intelligence, the European Union member sent $362.12 million in bitcoin to various exchanges and brokers in a three-hour period on Tuesday, including $184.58 million sent in a 20-minute window.
That said, it must be remembered that not all BlockchainTransfers based on German government bitcoin addresses are necessarily sales, as they are simply transfers to various exit ramps for cryptocurrencies.
In fact, the German government has received bitcoin from multiple exchanges in the past 24 hours. That’s likely because the bitcoin couldn’t be sold at the prices the government wanted, The Block reported Monday. Germany still has about $1.31 billion in bitcoin to sell, according to Arkham Intelligence.
Bitcoin Investors Look to Powell and the Fed
Bitcoin and other market analysts will be watching Federal Reserve Chairman Jerome Powell’s testimony during his semiannual monetary policy briefing to Congress on Tuesday and Wednesday, as some hope for signs that interest rates could be lowered before the end of the year, which could be a boon for all markets.
Higher rates pushed up Treasury Yieldsmaking them more attractive than riskier investments like cryptocurrencies. That could change once the Fed lowers its benchmark rate and interest rates start to fall.
Currently, the CME FedWatch Tool indicates that markets are almost unanimously expecting rates to remain unchanged for the Fed meeting later this month; however, there is about a 73% chance that a rate cut will be expected in September.