The US Spot Bitcoin ETF experienced a surge in momentum on Thursday, December 26, following a significant shift in fund flows that could signal a recovery for the flagship cryptocurrency. After a period of outflows that started in mid-December, Bitcoin ETFs are now seeing renewed institutional interest, signaling potential bullish movement for the digital asset.
Bitcoin ETFs See Major Inflows
The US Spot Bitcoin ETF had been grappling with a massive outflow of funds since December 19, which caused a dip in Bitcoin’s price and contributed to growing concerns in the broader crypto market. However, recent data from Farside Investors shows a dramatic reversal in this trend. On December 26, Bitcoin ETFs recorded an influx of $475.2 million, marking a return of investor confidence.
Leading the charge was Fidelity’s FBTC, which saw an impressive $254.4 million inflow on Thursday, signaling a renewed interest from institutional investors. Ark’s ARKB and BlackRock’s IBIT also contributed to the uptick, with inflows of $186.9 million and $56.6 million, respectively. This reversal comes after a worrying phase where Bitcoin ETFs experienced an outflow of $1.51 billion from December 19 to December 24, a period that weighed heavily on investor sentiment.
Ethereum ETFs Also See Positive Inflows
Alongside the Bitcoin ETF recovery, the US Spot Ethereum ETF also reported positive inflows. On December 26, Ethereum ETFs recorded a total influx of $117.2 million, with Fidelity’s FETH leading the charge with an $83 million investment. The growing interest in both Bitcoin and Ethereum ETFs highlights the increasing institutional support for digital assets, even amid broader market volatility.
Bitcoin Price and Market Sentiment
Despite the positive fund flows, Bitcoin’s price faced a decline of about 3%, trading at $94,975 on December 26. Trading volumes saw a 28% increase, with Bitcoin touching a 24-hour high of $97,784. However, despite the uptick in trading activity, Bitcoin Futures Open Interest dropped by 3% in the last four hours, reflecting bearish sentiment in the market.
Many analysts have shared cautionary forecasts, predicting that Bitcoin could face a significant downturn, with some speculating that it could drop to $60,000 in the near future. These predictions have sparked debates about Bitcoin’s next move and whether it can sustain the positive momentum generated by the ETF inflows.
Institutional Confidence and Long-Term Outlook
Despite the short-term uncertainties, some market experts remain optimistic about Bitcoin’s long-term trajectory. Institutional interest, as evidenced by the ETF inflows, continues to grow, with Bitwise recently filing for a new BTC ETF designed to track companies such as MicroStrategy and Metaplanet. This reflects a growing institutional confidence in Bitcoin and suggests that the digital asset could rebound and reach new highs in the coming months.
As the market digests these changes, Bitcoin’s future remains in the hands of institutional investors and market dynamics. The recent inflows into Bitcoin and Ethereum ETFs indicate that despite the current volatility, institutional interest in digital assets is far from waning.
