Bitcoin surpassed $70,000 on Tuesday, March 4, as strong inflows into U.S. spot Bitcoin exchange-traded funds (ETFs) and rising derivatives demand supported a fresh rally in the cryptocurrency’s price.
The price gain occurred even though there are ongoing economic uncertainties and geopolitical tensions currently pressuring most risk assets globally.
Bitcoin ETFs Record $225M Net Inflows
Approximately $225.15 million flowed into US-based BTC spot ETFs based on data from SoSoValue. Much of the inflow was driven by BlackRock’s iShares Bitcoin Trust (IBIT), which experienced approximately $322.38 million in inflows on March 3.
Demand for the product provided a sufficient counterbalance to outflows from competing products. Fidelity’s Wise Origin Bitcoin Fund (FBTC) had roughly $89.29 million in net outflows. Grayscale’s Bitcoin Trust (GBTC) had approximately $28.19 million leave the fund.
Smaller ETFs reported varied results. Valkyrie’s BRRR ETF received approximately $11.57 million in inflows, while WisdomTree’s BTCW ETF received roughly $8.68 million in inflows. No inflows or outflows were reported for other products during the same timeframe.
Source: SoSoValue
Bloomberg ETF analyst Eric Balchunas said the flows were another solid day for Bitcoin ETFs. He added that multiple funds have now recorded positive year-to-date flows after the BTC price plummeted significantly early in the year.
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Price Reaches $71,400
Bitcoin’s price momentum improved as the asset regained key technical levels. Based on current Trading View data, the price of BTC is approximately $71,480, an increase of about 4.6% from the prior 24 hours. The rally has also caused BTC to rise more than 11% over the last seven days, indicating improvement in short-term sentiment, as the data showed.
Source: TradingView
However, the cryptocurrency is still down about 7% over the last thirty days and about 18% year-to-date. As such, the current rally represents price movement within a larger framework of market volatility.
CryptoQuant analyst Darkfost noted that Bitcoin’s performance is particularly impressive considering the overall macroeconomic climate. Geopolitical tensions involving Iran have made the process of international energy trade flows more complex.
This caused European gas prices to jump by more than 70%. Therefore, BTC’s continued resilience demonstrates growth in the digital asset space.
In addition, Darkfost explained that the rally is occurring alongside five consecutive days of inflows into spot Bitcoin ETFs. Thus, reinforcing the belief that institutional demand may help stabilize price movements.
Buyers Are Gaining Upper Hand in Market Control
Signals from the derivatives markets suggest that buyer interest continues to grow. CryptoQuant analyst Darkfost stated that the taker buy/sell ratio at Binance rose to 1.18 yesterday, the highest since the beginning of the year.
According to him, the taker buy/sell ratio above one is usually indicative of buyers being in control of market activity. Darkfost also indicated that taker buy volume exceeded $1 billion per hour several times throughout the day. He further said that this contributed to BTC quickly breaking through the $71,000 barrier.
Source: X
Why Does This Matter?
Increased investment into ETFs and derivatives purchases may continue to provide institutional support for the BTC price, even during uncertain macro-economic conditions.
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