Bitcoin remained offered Thursday amid signs of continued demand for spot exchange-traded funds (ETFs).
The leading cryptocurrency traded near $72,500 on Thursday, according to CoinDesk market data. U.S.-listed cash ETFs generated another $155 million in net inflows on Wednesday, extending a recent streak of institutional buying that helped lift prices after weeks of sluggish activity.
These new inflows bring total allocations to about $1.47 billion over the past two weeks, according to data organized by SoSoValue, marking a sharp reversal after several weeks of withdrawals earlier this year.
Institutional demand via ETFs has started to stabilize after a difficult start to the year. Investors have invested about $1.7 billion in U.S. spot Bitcoin ETFs since Feb. 24, according to Bloomberg Intelligence data previously reported by CoinDesk, suggesting some investors are increasingly convinced the market may have found at least a near-term bottom.
Earlier this week, Bitfinex analysts warned that ETF inflows do not always translate into immediate buying pressure in the spot market. Authorized participants can create and short ETF shares before purchasing the underlying bitcoin, thereby delaying the price impact of these flows.
Nonetheless, spot ETF inflows and bitcoin’s recent resilience in the face of geopolitical tensions indicate the cryptocurrency’s growing macroeconomic importance, according to some market participants.
“The market is increasingly revaluing Bitcoin as a geopolitical hedge rather than just a risk asset,” said Livio Weng, CEO of Bitfire. “Unlike gold, bitcoin is traded 24/7 and can cross borders instantly, making it a natural escape valve for capital in times of geopolitical stress.”
On-chain data calls for caution
Despite the rebound in flows, underlying demand signals remain fragile, according to Glassnode. In a recent report, the company said momentum on the buy side has weakened significantly, with the 30-day moving average of realized profits falling about 63% since early February.
The share of Bitcoin supply held in profits has also fallen to around 57%, a level historically associated with the early stages of deeper bear market conditions. Glassnode added that the short-term holders’ cost basis near $70,000 could act as a key behavioral cap, potentially turning rallies into distribution zones as traders exit near-breakeven positions.
