Benzinga - by Abbey Higginbotham, Benzinga Staff Writer.
Despite substantial inflows into spot Bitcoin ETFs, the cryptocurrency’s price continues to tank. At last check, Bitcoin is down over 3.9%.
This has left market observers puzzled about the apparent disconnect between the influx of capital and the lack of price movement.
Institutional Inflows and Market Resistance James Van Straten, lead analyst at Crypto Slate, points out that the broader market forces are at play.
“Yup, the market is way bigger than the ETFs,” Van Straten notes. He emphasizes that despite the significant accumulation of Bitcoin (71,000 BTC in the past 30 days), many investors are taking profits, which could be offsetting the buying pressure from ETFs.
Internal Selling Pressure A Bloomberg analyst, Eric Balchunas, offers another perspective, suggesting that the ETFs are not causing the stagnation.
I've said it before and I'll say it again, the call is coming from inside the house holmes. This is not ETFs doing, obv bc they buying like crazy lately, it's bitcoin holders selling or leveraged flushers or whatever. Time and again ETFs go on flow-a-thons and its met with… https://t.co/iuGNayrLgd— Eric Balchunas (@EricBalchunas) June 6, 2024
“This is not ETFs doing, obv bc they buying like crazy lately, it's bitcoin holders selling or leveraged flushers or whatever,” Balchunas explains. He highlights a recurring pattern where ETF inflows are met with selling from other holders, dampening the potential rally.
Transparency Concerns in the Market Frank Makrides raises concerns about market transparency. “Can you please explain to me how we have had record amounts of fund flows into the $BTC ETFs, and we are still range bound?” he asks. Makrides calls for major institutions like BlackRock and Fidelity to disclose their activities with their funds, highlighting the need for greater transparency within the cryptocurrency ecosystem.
Market Dynamics and Patience Ludwig Wittgenstein draws a parallel to the patience exhibited by Roaring Kitty in his famous GameStop play. “Crypto participants can't stand a ‘chop' for more than three seconds, running from one narrative to the other,” Wittgenstein observes, suggesting that the frequent shifts in focus within the crypto market contribute to the lack of sustained upward momentum.
Upcoming Digital Assets Event These market dynamics and their implications for Bitcoin and the broader cryptocurrency market will be key discussion points at the upcoming Benzinga Future of Digital Assets event on November 19, 2024. This one-day event at Convene 225 Liberty Street, NYC, will gather leaders and institutional investors in the digital asset space. Attendees will have opportunities for one-on-one meetings, speed networking sessions, and exclusive roundtables with industry executives.
Since 2022, the conference has attracted thousands of attendees and promises significant improvements in the 2024 agenda. Featured speakers include Anthony Scaramucci, Tim Draper, and Jan van Eck, among others. The event aims to provide a comprehensive understanding of the state of digital assets and foster valuable connections within the industry.
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