US Bitcoin ETFs have achieved a significant milestone, recording their highest daily inflow since inception, amassing an impressive $870 million on Tuesday. This surge in investment comes as Bitcoin, the largest cryptocurrency, edges closer to its all-time high of $73,700, originally reached in March.
This influx of investment is largely attributed to increasing investor optimism, fueled by speculation that a potential victory for Republican candidate Donald Trump over Vice President Kamala Harris could create a more favorable environment for the digital asset ecosystem, ultimately boosting cryptocurrency prices.
According to Bloomberg data, Tuesday’s surge in subscriptions pushed the year-to-date inflows for the group of 12 Bitcoin ETFs to over $23 billion. Analysts credit this growing demand for Bitcoin exposure to Trump’s rising odds in election betting markets.
However, the race remains tight as polls show a close contest between Trump and Vice President Harris, who advocates for a regulatory framework for the cryptocurrency industry. Despite this, Trump’s stance seems to resonate more with the crypto community.
In addition to market speculation, Bitcoin options markets indicate a one-third chance of a price swing exceeding 10% on election day, November 5, as noted by Nick Forster, founder of the crypto trading platform Derive.xyz. Should Bitcoin consolidate above $72,000 in the coming days, it could reach a new all-time high of $72,900.
Forster posits that such market volatility often prompts traders to position themselves for potential movements, thereby increasing demand for Bitcoin ETFs and contributing to the recent price surge observed since the beginning of the week.
ETF expert Eric Balchunas has also weighed in on the bullish sentiment surrounding Bitcoin ETFs. He highlighted that these funds are on the verge of reaching 1 million BTC in holdings, possibly as soon as today. Balchunas reported that US spot ETFs could potentially surpass 1 million BTC by next Wednesday, overtaking the holdings of Bitcoin’s enigmatic creator, Satoshi Nakamoto, by mid-December, with the funds accruing about 17,000 BTC each week.
Following Tuesday’s remarkable performance, Balchunas noted, “We’re going to need to move up our predictions,” pointing out that Bitcoin ETFs had accumulated over 12,000 coins in a single day, now holding 996,000 BTC. He expressed confidence in breaching the 1 million mark today, attributing the extraordinary trading volume from the previous day to substantial inflows.
Nevertheless, Balchunas also cautioned that market conditions are unpredictable. He warned of the risk of a sudden selloff that could delay reaching the 1 million BTC milestone. Conversely, if Bitcoin prices continue to climb and a Trump victory amplifies market enthusiasm, fear of missing out (FOMO) could accelerate accumulation even further, according to Balchunas’s analysis.
As of the time of writing, Bitcoin, the largest cryptocurrency on the market, was trading at $72,360, reflecting an increase of over 8% within the 7-day timeframe.
