It looks like Bitcoin ETFs in the U.S. are on a serious buying spree, scooping up way more BTC than is actually being mined each day.
On November 19, these spot Bitcoin ETFs accumulated nearly 9,000 BTC, and this isn’t the first time.
Supply imbalance, or an actual supply shock?
That’s around $814 million flowing into these funds across eleven different ETFs. To put this into perspective, only about 450 BTC are mined daily.
If institutional funds keep buying up coins at this pace, we could be facing a supply shock soon.
This week alone, more than $1 billion has flooded into spot Bitcoin ETFs, showcasing the strong market momentum.
On Tuesday, Ark 21Shares, Fidelity, and BlackRock saw impressive inflows of $267.3 million, $256.1 million, and $213.5 million, respectively.
Bitwise, Grayscale, and VanEck also enjoyed some minor inflows but no outflows for two days straight! Since their launch in January, these products have raked in total of $28.5 billion.
Supply, demand, and the prices
The surge in demand suggests that institutional investors are driving this rally while retail investors are still sitting on the sidelines.
#Bitcoin supply shock:
There are 1,215,672 #Bitcoin left to be mined, that means 94.21% of all 21 million $BTC are in circulation. And the first few institutions are just waking up.
Are you ready for what’s coming? pic.twitter.com/qDoNUXbAu3
— Carl ₿ MENGER ⚡️🇸🇻 (@CarlBMenger) November 19, 2024
Bitcoin reached an all-time high of just over $94,000 during late trading on Tuesday but dipped slightly to $92,320 during Wednesday’s morning session in Asia.
Adding to the excitement was the launch of BlackRock’s iShares Bitcoin Trust options on Tuesday.
These options saw nearly $2 billion in notional exposure traded on their first day, which is a serious acchievement.
Bloomberg ETF analyst James Seyffart noted that these options likely contributed to Bitcoin’s recent price peak.
Lot of money to spend
Nate Geraci, president of ETF Store, shared that option trading opens a totally new market, bringing in new investors.
“Options add an entirely new dimension. It makes it much easier and more enticing for institutional investors to enter the arena.”
Until now, spot Bitcoin ETF options were only available outside the U.S., so this launch opens up access to the largest liquidity pool in the world.
If these funds keep buying up Bitcoin to meet demand, many think we could see prices skyrocket.
