Spot Bitcoin ETFs Witness $438M in Inflows in 2 Days Amid Dip Buying Spree

Investors are capitalizing on the recent dip in Bitcoin prices by pouring money into Bitcoin exchange-traded funds (ETFs).

Over the past two trading sessions, US Bitcoin ETFs have experienced a net inflow of $438 million, according to data compiled by Bloomberg.

The surge in investments comes at a time when the original cryptocurrency has faced a decline of around 20% since early June.

However, market participants view this price dip as an opportunity for buying.

“So many investors still don’t own Bitcoin, and that underpins the long-term bull case,” Charlie Morris, chief investment officer at ByteTree, wrote in a note. “This supply storm will soon pass.”

On July 8, the total net inflow of Bitcoin spot ETFs was $295 million, the highest inflow in the past 21 days. Yesterday, the German government also sold the largest amount of BTCs in recent times, reaching $915.3 million. Grayscale ETF GBTC had a single-day inflow of $25.0753…

— Wu Blockchain (@WuBlockchain) July 9, 2024

Investors Seize Buying Opportunity

While Bitcoin has been under selling pressure from various sources, including repayments related to Mt. Gox and a German government entity liquidating Bitcoin on exchanges, analysts speculate that investors perceive this selling pressure as an attractive entry point.

CoinShares, an investment firm, reported total inflows of $441 million into digital asset investment products for the week.

However, trading volumes in exchange-traded products remained relatively low at $7.9 billion, which aligns with typical patterns observed during the summer.

Historically, July has been a bullish month for the crypto market, with a median return of 9%. Many traders anticipate this trend to continue.

Data from SoSoValue reveals that the cumulative net inflow for Bitcoin has reached $15 billion, with a daily net inflow of $294 million.

The total net assets across Bitcoin ETFs currently stand at $49.32 billion, while Bitcoin’s price at the time of reporting is $55,844.2.

These figures highlight the sustained institutional interest in Bitcoin through regulated ETF products, despite recent price volatility and selling pressure.

The willingness of investors to buy during price dips can potentially provide support for Bitcoin’s value in the face of ongoing market challenges.

German Government Gets Back $200M from Exchanges

In another positive news that further boosted sentiment in the crypto market, a German government entity recently received over $200 million worth of Bitcoin back from various exchanges.

The return of these assets provided a much-needed confidence boost, with Bitcoin trading at just above $57,300 during Asian morning hours, reflecting a 3.5% increase in the past 24 hours.

Other major cryptocurrencies, such as Solana (SOL), Ether (ETH), and even dogecoin (DOGE), also experienced notable gains.

Bitcoin faced a brief drop to as low as $55,000 on Monday, triggered by a large transaction involving the German Federal Criminal Police Office (BKA).

However, it was later revealed that the BKA had received over $200 million back from exchanges, including Kraken, Coinbase, and Bitstamp, within the past 12 hours.

Fortunately, the assets did not hit the market, providing reassurance to traders.

Meanwhile, Bitcoin miners are facing a critical phase known as “capitulation” as their profits diminish amidst the recent sell-off in the Bitcoin market.

Miner capitulation occurs when miners reduce their operations or sell a portion of their mined Bitcoin and reserves to sustain their operations, earn yield, or hedge their Bitcoin exposure.

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