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Bitcoin (BTC) price reached the level of $63,000 following the transactions made on Thursday. The bullish sentiment in trading was supported by an increase in Bitcoin ETF inflows and investors’ appetite for risk. Here are the details!
Excess Demand for Bitcoin
Bitwise CIO Matt Hougan stated in an interview with Yahoo Finance that there is currently an excess demand and supply shortage for Bitcoin. While there is a supply shortage in the OG cryptocurrency, the likelihood of people paying large sums for a small part of token risk may increase. Matt Hougan also added that the upcoming Bitcoin halving will further change the demand and supply dynamics for Bitcoin. In such a case, it is likely that Bitcoin supply will remain lower than demand. If these data continue in the same way, after the halving takes place, this situation could likely provide a good increase in prices.
On February 28, spot Bitcoin exchange-traded funds (ETFs) saw a net inflow of $673 million. This milestone was the largest inflow since the US SEC approved spot Bitcoin ETFs in January. A massive trading volume of $8 billion was reported by all spot BTC ETFs led by BlackRock. Considering the recent increase in Bitcoin price and the growing demand for ETFs, the upward momentum could continue for some time.
Trading Volume Increases in Bitcoin
Ethereum and BTC’s return on investment (ROI) is higher than other assets like gold, oil, stock markets, and other tokens, leading Wall Street investors to pour capital into Bitcoin ETFs. The Crypto Fear and Greed Index reached a four-year high closure compared to previous ones. Currently, the market exhibits “Extreme Greed” with levels around 80. BTC’s price previously surpassed $63,000 and is currently only a small percentage behind the peak of $68.7 thousand set 27 months ago. Additionally, there was a 150% increase in trading volume in the last 24 hours. This increase may indicate that investors are showing more interest in joining the BTC bandwagon.
