Forbes India 15th Anniversary Special

Bitcoin hits $64,000 driven by halving anticipation and spot ETFs

The recent rally has resulted in a 93 percent surge in Bitcoin's (BTC) daily trading volume, reaching $90.2 billion

Shashank Bhardwaj
Published: Mar 1, 2024 03:42:19 PM IST
Updated: Mar 1, 2024 03:46:13 PM IST

Bitcoin hits ,000 driven by halving anticipation and spot ETFsImage: Shutterstock
 
On February 28, the price of Bitcoin briefly surpassed $64,000 before pulling back towards the $62,000 level. The price movement witnessed this month is linked to the upcoming Bitcoin halving event, associated with significant upward price movements. The upsurge has also been credited to heightened inflows into newly established spot Bitcoin ETFs.

The recent rally had resulted in a 93 percent surge in Bitcoin's (BTC) daily trading volume, reaching $90.2 billion. This increase led to a rise in its market capitalisation to $1.23 trillion, solidifying its position as the leading cryptocurrency.

On the same day, US-spot Bitcoin ETFs experienced a record volume of $673 million. These inflows surpassed the previous peak of $655.2 million established on January 11, 2024, when the ETFs first began trading.

Among the US-spot Bitcoin ETFs, BlackRock's iShares Bitcoin Trust contributed approximately $6.12 million, marking its highest recorded inflow to date.

Following closely, the Fidelity Wise Origin Bitcoin Fund saw approximately $245.2 million in inflows, securing the second position, while the ARK 21Shares Bitcoin ETF ranked third with $23.8 million.

Notably, the newly introduced Bitcoin ETFs collectively attracted net inflows of around $7.4 billion, marking the highest inflow since their inception.

Meanwhile, the volatility in Bitcoin's price led to significant liquidations of leveraged positions across the crypto market.

During the early hours of Asian trading on February 29, with Bitcoin's price around $63,500, short positions worth $435 million were liquidated in the past 24 hours, compared to $364 million in long liquidations. As the New York trading session commenced with prices at approximately $62,500, a total of $683 million, consisting of $341 million in longs and $341 million in shorts, were liquidated within 24 hours.

Due to Bitcoin's recent price movement, it's expected that the cryptocurrency will encounter minimal resistance as it continues to appreciate in value. Bitcoin is presently short of 13 percent of reaching its all-time peak value, with both retail and institutional investors anticipating a surpassing of the record $68,900 level before the upcoming supply halving, slated to happen in approximately 52 days.

Increased inflows into newly established spot Bitcoin ETFs reflect the growing acceptance of crypto in traditional financial markets. Despite short-term fluctuations, Bitcoin's long-term outlook remains optimistic, supported by institutional interest and adoption.

Shashank is the founder of yMedia. He ventured into crypto in 2013 and is an ETH maximalist.
Twitter: @bhardwajshash