US Bitcoin ETF Sees Largest Daily Inflows Since Late July, Bitcoin Exceeds $60,000

Fidelity's Bitcoin fund leads with $102 million inflows as market recovers.

Key takeaways

• The US Bitcoin ETF saw its biggest one-day inflows since late July, exceeding $263 million.
• Bitcoin's price surge coincided with huge ETF investment, peaking at more than $60,000.

Inflows into the US spot Bitcoin exchange-traded fund surged on Friday, with net purchases reaching $263 million, the biggest one-day inflows since July 22. Bitcoin's strong performance returned on a day when it rose 12% in the week and surpassed $60,000, according to TradingView.

Investors have poured about $102 million into Fidelity Bitcoin (FBTC), boosting the fund's weekly gains to about $218 million, according to data from Farside Investors.

FBTC led the pack with a strong comeback this week after suffering two consecutive weeks of negative performance. About $467 million was withdrawn from the fund at this stage.

FBTC was followed by ARK Invest/21Shares Bitcoin Fund (ARKB), closing on Friday with about $99 million in net capital. Other competing Bitcoin ETFs managed by Bitwise, Franklin Templeton, Valkyrie, VanEck and Grayscale also saw positive inflows.

Meanwhile, BlackRock's iShares Bitcoin Trust (IBIT), WisdomTree's Bitcoin Fund (BTCW) and Grayscale's Bitcoin Mini Trust (BTC) saw no inflows.

IBIT's recent performance has been lackluster. No inflows were observed on almost every trading day in the past two weeks.

During this period, the fund experienced net outflows on two days, August 29 and September 9. IBIT has recorded a total of three days of net outflows since its inception.

Following a big rally on Friday, the US Spot Bitcoin ETF ended the week with a net inflow of over $400 million.

This positive sentiment has not only been limited to US Bitcoin funds, but has also fuelled the broader cryptocurrency market. Bitcoin (BTC) rose from $54,300 on Monday to $60,600 yesterday. The flagship cryptocurrency is now trading at around $60,200, according to TradingView data. Ethereum (ETH) has risen 8% in a week to $2,400. Among the top 20 crypto assets, Toncoin (TON), Chainlink (LINK) and Avalanche (AVAX) saw the biggest gains, according to CoinGecko data.

Bitcoin ETF Investors in the Red: ARK Invest

According to a recentreport from ARK Invest, the average cost basis of US spot Bitcoin ETF investors was above the current market price at the end of August. This suggests that a large proportion of these participants are now underwater.

The price-weighted moving average used to calculate the price index indicates that investors who got in earlier bought at a higher price, making the downside worse. of the approximate cost. 

However, ARK Invest says Bitcoin's fundamentals are still intact based on the MVRV Z-score, a measure that compares Bitcoin's market capitalization to its value proposition. 

General sentiment towards Bitcoin remains positive. Attention is focused on the Fed interest rate decision. The current rally is due to expectations that  the Federal Reserve will cut rates again. Market participants expect a 25-50% rate cut at the FOMC meeting next week on Wednesday, September 18th.