Are prices ready for $100,000?

While the Bitcoin price has faced challenges as ETF flows fluctuate, underlying institutional demand remains strong. Major institutions such as BlackRock and Fidelity are entering the ETF market, which could further influence Bitcoin's price movement. Eric Balchunus, Senior ETF Analyst at Bloomberg Intelligence, joins David Lin to discuss ETFs and BTC. Eric suggests that the lack of correlation between Bitcoin price and ETF flows can be attributed to several factors.

Market Dumps: He described events such as the Gox settlement where large amounts of bitcoin were sold, contributing to downward pressure on prices. German sales also played a role in affecting market volatility.

Early Investors Taking Profits: Many long-term Bitcoin holders sell their holdings when the price approaches key thresholds, typically around $60,000 to $65,000. This profit-taking behavior was especially evident when prices reached $69,000 to $70,000, which prevented the price from entering new highs.

Changing Investor Profiles: Many of the early Bitcoin investors are now older and may have additional financial responsibilities, Eric said. This change in investor psychology may lead them to prioritize profit taking over holdings.

ETF flows: A mixed picture

Despite recent price challenges, Eric said the Bitcoin ETF has seen year-to-date net inflows of up to $18.8 billion. This figure is important, especially considering the opening of GBTC and any outflows during the fall. It is argued that this net positive flow reflects strong institutional interest and can be linked to the excitement surrounding Bitcoin ETFs.

ETF Value on Value: Eric argued that the hype surrounding Bitcoin ETFs played a significant role in pushing the price from $30,000 to $45,000, then from $45,000 to around $60,000. He pointed out that without ETF approvals, Bitcoin trading could be very low.