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Bitcoin soars as net inflows to BTC spot ETFs continue to rise

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Bitcoin (BTC) ended the week at approximately $48,300, showing a notable 13.4% increase from the previous week’s closing value of around $42,600, according to a note from Research Analyst Matteo Greco at the publicly listed digital asset and fintech investment business Fineqia International.

Throughout the week, BTC demonstrated significant strength, consistently closing higher each day compared to the preceding day’s closing price.

Following moderate gains on Monday and Tuesday, pushing the price above $43,000, Greco highlights that BTC exhibited strong momentum in the subsequent days, closing above $47,000 by Friday. Although the pace of the price increase slowed over the weekend, BTC concluded the week at approximately $48,300.

According to Greco, the primary driver behind this price appreciation can be attributed to the increased inflow into BTC Spot ETFs. As anticipated in previous weeks, the outflow from the Grayscale Bitcoin ETF (GBTC) was expected to diminish after the initial couple of weeks of trading. This expectation materialised, with GBTC outflows showing a significant decrease in the final days of January and continuing to decline through February.

The daily outflow from GBTC during the two initial weeks post-approval averaged around $500 million. However, in the past week, total outflows from GBTC amounted to approximately $415 million, translating to a daily average of about $83 million. This represents nearly an 85% reduction in outflows compared to the first two weeks of trading.

Greco wrote: “The noticeable correlation between the diminishing outflows from GBTC and the upward trend in prices is also evident when examining the total daily flows into BTC Spot ETFs. The substantial reduction in GBTC outflows began on January 26th, coinciding with the beginning of a consistent influx into BTC Spot ETFs, resulting in 11 consecutive days of net inflows, commenced exactly on the 26th of January.

“Furthermore, there is a strong correlation between the magnitude of the inflows and the reduction in GBTC outflows. While GBTC recorded a cumulative outflow of $415 million last week, representing a significant reduction from previous weeks, BTC Spot ETFs saw a total net inflow of about $1.2 billion during the same period, marking the highest weekly inflow since their launch.”

Among the newly launched BTC ETFs, Blackrock (IBIT) maintains its lead with about $4.2bn in assets under management (AUM), followed by Fidelity ETF (FBTC) with approximately $3.5bn in AUM. Notably, a third ETF surpassed $1bn in AUM last week, as the BTC ETF offered by Ark & 21Shares (ARKB) now boasts $1.02bn in AUM.

“Additionally, it is noteworthy that the past week witnessed the first daily outflow from a BTC ETF other than GBTC. Specifically, Galaxy & Invesco ETF (BTCO) experienced approximately $17.5 million in outflows on Friday,” wrote Greco.

“Trading volumes remain exceptionally high, with a cumulative volume of about $5.5bn recorded in the past week, equating to a daily trading volume of approximately $1.1 billion. Since their inception, cumulative trading volumes have reached $35.6bn, with an average daily trading volume of around $1.7bn.”

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