On Valentine’s Day, the cryptocurrency market surprised investors with a remarkable surge that saw Bitcoin (BTC) surpass the $51,000 mark for the first time in over two years.
Late on February 14, the apex cryptocurrency inched closer and even crossed the $52,000 milestone, pushing its market capitalization over $1 trillion, a valuation that had not been reached since late December 2021.
Bitcoin also managed to regain lost ground from Tuesday when the token was trading below the $50,000 mark.
Bitcoin Crosses $52,000 As Net Inflows To BTC Spot ETFs Exceed $4 Billion
The latest surge in Bitcoin prices was supported by significant inflows into the US-listed spot Bitcoin exchange-traded funds (ETFs). Just recently, the cumulative net inflows to the ETFs tracking the price performance of Bitcoin exceeded $4 billion.
On Tuesday, the funds recorded a net inflow of $631 million, the single highest rate of capital flow to the Bitcoin-focused investment vehicle. Bitcoin ETFs are averaging between $500 million to $650 million in net inflows. This influx translates to a daily acquisition of 10,000 to 13,000 BTC.
Notably, it was asset management giant BlackRock’s iShares Bitcoin Trust (IBIT) ETF that was the best-performing among the listed funds. The ETF managed to attract nearly $500 million in net inflows on Wednesday. Fidelity’s Wise Origin Bitcoin Fund (FBTC) ETF came in second place with $164 million.
Meanwhile, the outflows from digital asset manager Grayscale’s Bitcoin ETF – Grayscale Bitcoin Trust (GBTC) – are gradually slowing down.
Investors and market analysts are closely monitoring the impact of these capital inflows on Bitcoin’s price dynamics.
Renowned crypto analyst Ted Talks Marco suggested in an X post that there is a correlation between net inflows and BTC’s price movements. According to his estimates, for every $1 billion in net inflows, the price of Bitcoin increased by approximately $2,900.
The trend showcases the growing influence ETFs have on the cryptocurrency market, especially Bitcoin.
Bitcoin Leaps Over Tesla And Walmart In Market Capitalization
The sudden surge in Bitcoin price has resulted in the world’s most traded cryptocurrency’s market capitalization crossing the $1 trillion mark for the first time since December 2021. In the process, Bitcoin managed to surpass the market caps of giants like Tesla, Walmart, and Berkshire Hathaway, placing itself as the 10th largest asset in the world.
The achievement underlines Bitcoin’s growing popularity in the financial landscape and its resilience as a decentralized digital currency.
Bitcoin Price Could Peak At $58,000 Before April’s Halving
Experts are anticipating another rally for Bitcoin ahead of the block reward halving event on its blockchain that is scheduled to occur in late April.
According to Michael van de Poppe, founder of MN Trading Consultancy, Bitcoin’s pre-halving rally could peak between $54,000 and $58,000. The positive outlook on the price trajectory of Bitcoin is attributed to the halving event and the continuous influx of capital into the BTC spot ETFs.
Meanwhile, a recent survey from QCP Capital suggested that global liquidity has been rotating back into Bitcoin ETFs. The crypto asset trading firm expects the BTC price to touch at least $70,000 by the end of March.
Institutions like Fidelity have signaled a shift by allocating 1-3% of their All-in-One conservative ETFs to cryptocurrencies. The move is reflective of the acceptance of the digital asset class by traditional and mainstream investors.
Apart from the spot market activity, there has also been a surge in Bitcoin call option purchases. This week alone, close to $10 million has been expended on premiums for call options with strike prices ranging from $60,000 to $80,000 that expire between April and December.
QCP analysts anticipate that the surge in capital inflows into the Bitcoin spot ETFs could lead to the price of the world’s most traded cryptocurrency surpassing its all-time highs by March-end.
At the time of writing, Bitcoin (BTC) is trading at $51,976 – up nearly 5% in the last 24 hours.
