Industry watchers say that even though bitcoin has seen a rise in price each month for the past seven, those looking to profit could end this streak.
Fineqia data shows that Bitcoin’s value ended up at approximately $71,300. That’s a roughly 17% jump from the $61,150 it was valued at at the beginning of February.
It was the seventh straight month that the bitcoin price (BTC) increased, a streak of record for this asset.
Matteo Greco, a Fineqia analyst and research specialist, says that the demand for bitcoin spot ETFs is a major driver behind this streak.
The anticipation for spot bitcoin ETFs to be approved in 2023’s final quarter has increased. Securities and Exchange Commission approved such funds in January to begin trading. These offerings have brought in roughly $12 billion net of inflows.
While bitcoin’s price rose roughly 65% during the first quarter of 2024, BTC sat at about $68,230 at Noon Friday — down 3.5% from seven days ago.
In spite of the high demand for Bitcoin ETFs on the spot market, the flows to the fund during the early days of the month were slower than usual.
Farside Investors’ data shows that spot bitcoin ETFs experienced net outflows on the 1st of April of $86m. The net inflows for the next three days totaled 367 million dollars.
Greco said that while it is difficult to predict short-term movements, historically, price drops are often observed leading up to a halving.
“Additionally, we’re currently witnessing increased profit-taking among both cryptocurrency investors and [traditional finance] ETF investors,” Greco tells Blockworks. “This natural behavior follows seven months of continuous growth, suggesting the possibility of a downward trend in April or in one of the following months.”
Sergei Gorev is the risk manager for fintech platform YouHodler. He said bitcoin was still in the consolidation phase before the bitcoin halving. This will reduce the per-block rewards.
“It is obvious in the market that investors who bought BTC at a lower price are now taking profits,” “He said” “However, there are still many crypto enthusiasts who are waiting for prices to fall in order to buy further.”
Gorev claimed that the current crypto market is not characterized by any significant factors which would cause it to end its seven-month price increase streak in April.
“But still, there is a little possibility of a black swan appearing in the stock market, which could drive risk assets, including the crypto market, down,” He added.
Other remain more bullish.
Will McDonough of Corestone Capital noted that spot bitcoin ETFs had already lowered entry barriers for many into this asset class. This trend, he predicts, will continue to expand once the brokerage firms begin to offer such products.
It is expected that this new segment of high net worth investors will enter the market in conjunction with the bitcoin halves scheduled to take place within a few weeks.
“I can see bitcoin easily reaching six figures by the end of the year,” McDonough tells Blockworks. “Absent some massive messaging around the presidential election cycle about banning blockchain adoption, I don’t think anything can stop this momentum this year.”
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