The flow of capital into spot Bitcoin exchange-traded funds (ETFs) surged past $1 billion this week, as analysts forecast a potential all-time high for Bitcoin within the next three months. Weekly inflows into Bitcoin ETFs hit $1.11 billion for the first time since July, bringing total net inflows across 12 different Bitcoin ETFs to a record-setting $18.8 billion, according to data from SoSoValue.
Breakdown of Inflows
On September 27 alone, inflows totaled $494.27 million, with ARK 21Shares’ ARKB leading the way with $203.07 million. Other significant contributors included:
- Fidelity’s FBTC: $123.61 million
- BlackRock’s IBIT: $110.82 million over a five-day streak of inflows
- Grayscale’s GBTC: $26.15 million, marking its first inflow since September 16
- Bitwise’s BITB: $12.91 million over four consecutive days of positive inflows
- VanEck’s HODL: $11.17 million
Notably, several ETFs, including Franklin Templeton’s EZBC, WisdomTree’s BTCW, and Grayscale’s Bitcoin Mini Trust, recorded no inflows.
Bitcoin Breaks Key Resistance
The sharp rise in ETF inflows coincided with Bitcoin breaking a crucial resistance level at $65,000. Many analysts believe this breach could trigger a surge of FOMO (fear of missing out) buying, potentially pushing the price of Bitcoin toward new all-time highs.
Markus Thielen of 10X Research emphasized that Bitcoin’s breakout above $65,000 could be the catalyst for a substantial rally in the fourth quarter. He highlighted several bullish drivers, including a $10 billion surge in stablecoin issuance following the Federal Reserve’s July meeting, which has poured liquidity into the crypto market.
Thielen also pointed to China’s massive monetary and fiscal stimulus as another key factor. With 55% of Bitcoin mining originating from Chinese pools, the country’s capital outflows could further fuel Bitcoin’s bullish momentum. He sees the potential for a front-loaded rally, with gains likely to materialize sooner rather than later.
Analysts See Strong Q4 for Bitcoin
Thielen is not alone in his optimism. Matt Mena of 21Shares echoed this positive outlook, noting that Bitcoin’s push past $65,000 has already sparked strong investor interest. Mena pointed to factors such as lower-than-expected inflation and the recent rate cut by the Federal Reserve, both of which have created a favorable environment for risk assets like Bitcoin.
He predicts that Bitcoin could soon retest the $68,000 to $70,000 range, driven by a combination of global liquidity injections and rising demand for higher-yielding assets. Mena also highlighted Bitcoin’s historical pattern of strong performance during the fourth quarter, particularly in years when the cryptocurrency’s halving event occurs.
Market Sentiment Shifts to Greed
Investor sentiment has dramatically shifted as well. The Bitcoin Fear and Greed Index, which measures market sentiment, surged to 64, signaling strong optimism after hitting a low of 17 in August. Bitcoin was trading at $65,757 at the time, up over 4% for the week and 11.18% for the month, marking its best performance since March.
One trader on X even speculated that Bitcoin could climb as high as $124,000 by the end of 2024, pointing to historical data that shows an average fourth-quarter return of 88.84% following a positive September.
Conclusion
With Bitcoin just 10.8% below its all-time high, analysts are increasingly confident that the cryptocurrency is on the cusp of a FOMO-driven rally. As inflows into Bitcoin ETFs continue to rise and market sentiment shifts to greed, the fourth quarter could see Bitcoin soar to new heights, potentially setting the stage for a historic run.
