Glassnode: US Spot ETFs Drive 4% of Bitcoin Market Net Inflows

• Around 4% to 5% of total Bitcoin net inflows since January are linked to US Spot ETF investments.
• US Spot ETF investors’ break-even cost ranges from $54.9k to $59.1k, reflecting potential stress points.

Particularly with the growing impact of Exchange Traded Funds (ETFs) in the United States, the Bitcoin market has shown an interesting trend from early January 2024.

A Glassnode insight indicates that the entrance of coins into the US Spot Bitcoin ETF accounts for between 4% and 5% of the overall net capital flow entering the Bitcoin market.

These products have underlying purchase values ranging from $54,900 to $59,100, which ETF investors can then consider as their breakeven point—that is, where their unrealized profit or loss will rely on the price movement of Bitcoin.

Bitcoin Nears Key Resistance Amid ETF Investor Breakeven Pressure

Though it hasn’t yet hit the all-time high (ATH), peak of $73,750, Bitcoin has demonstrated a notable rise in price in recent months. Analysts point out that the price of Bitcoin right now is getting close to a significant resistance level roughly corresponding to the breakeven mark for ETF investors.

Many ETF investors could be in a nominal loss posture right now with an average price between $54,900 and $59,100. With only modest selling pressure on the market, ETF investors are not displaying any symptoms of panic despite the psychological weight of unrealized losses nonetheless.

United States Bitcoin Spot ETFs have significantly changed the dynamics of the Bitcoin market. Originally developed by big companies like BlackRock and Fidelity, the ETFs today oversee assets valued around $58 billion.

This sum makes about 4.6% of the whole Bitcoin supply on hand. Supported by the rising institutional need for controlled and transparent Bitcoin exposure via ETF instruments, ETFs’ predominance in this market keeps growing.

Institutional Demand and ETF Growth Drive Bitcoin’s Price Resilience 

The Bitcoin market is seeing ongoing institutional influence increase. Capital flows from institutional investors to Bitcoin Spot ETFs have been consistently rising in the past few weeks. Many of them consider Bitcoin a long-term asset with great expansion possibilities.

The involvement of wealth management companies like Goldman Sachs and Morgan Stanley, who have greatly raised their stakes in Bitcoin-related ETFs, helps to emphasize this even more.

There have been many pivotal events during the last few weeks whereby Bitcoin has tested the break-even threshold for ETF players. Three times since July 2024, Bitcoin has either neared or exceeded the $59,000 milestone, offering ETF investors optimism of making money again.

Though multiple times unable to maintain increases beyond that level, the price trend points to Bitcoin starting to stabilize in this high price range.

Apart from the impact of ETFs, on-chain data reveals that short-term holders have shown rising profitability. According to recent figures, short-term holders of Bitcoin possess over 62% of the total in profit right now. This suggests fresh market interest, particularly among more sensitive price movements investors.

This profitability has also created good demand on the market, therefore stabilizing the price of Bitcoin in recent weeks.

Long-Term Holders Maintain Confidence Amid Institutional Demand for Regulated Exposure 

Long-term holders, in the meantime, have shown resilience by keeping their Bitcoin even if some of them are in a losing position.

Many BTC bought at the ATH peak of $73,000 have now moved into a long-term state following crossing the 155-day mark. Nonetheless, the unrealized losses of this group are not so great that they hardly affect the market.

Source: Glassnode

Furthermore, under observation by analysts is institutional desire for controlled Bitcoin exposure via ETFs, which is increasing.

As we previously highlighted, BlackRock and Fidelity are leading the way in handling Bitcoin-related assets, as we already mentioned; nonetheless, institutions like Goldman Sachs and Morgan Stanley are also enhancing their holdings in this sector.

This indicates that institutional interest in Bitcoin has not diminished but rather become more robust, along with better rules and more dependable investment tools.

On the other hand, a prior CNF report has revealed that the overall Bitcoin holdings in Bitcoin Spot ETFs already surpass 900,000 BTC.

Analysts estimate that before 2024 ends, this number will reach one million BTC. This supports the conviction that in the coming future, Bitcoin Spot ETFs will remain rather important in the dynamics of the Bitcoin market.

Meanwhile, BTC price was hanging about $61,975.52 at the time of writing, up 1.66% over the last 24 hours, and momentarily touched $62,000 in an effort to bounce back from the past decline.