U.S. Bitcoin ETF Inflows Surge – Will They Overtake Satoshi’s 1.1 Million BTC Before Year-End?

Are U.S. Spot Bitcoin ETFs on the Cusp of a Milestone?

The U.S. spot Bitcoin exchange-traded funds (ETFs) are poised to reach a remarkable milestone, with their holdings nearing the one million BTC mark after just ten months of trading.

As of 23 October 2024, these ETFs collectively held approximately 988,228 tokens, closing in on Satoshi Nakamoto's legendary stash of 1.1 million BTC.

The surge in interest has been fuelled by substantial inflows, coinciding with Bitcoin's impressive price rally, which has recently seen the cryptocurrency trading close to a three-month high just below $68,000.

What’s Behind This Surge in Demand?

The recent uptick in ETF inflows is significant.

On 14 October, these funds recorded their largest single-day inflow since early June, bringing in over $555 million.

The total assets added in the preceding week alone reached $2.1 billion, the highest since March.

Shaun Edmondson, Operations Manager at Gavin Edmondson Solicitors Ltd, commented on this phenomenon, stating,

“Yet another big day for BlackRock’s spot #Bitcoin ETF – now almost through 400,000 BTC under management.”

Market sentiment appears buoyant, largely attributed to the potential election of a crypto-friendly candidate, Donald Trump, as speculation swirls around his prospects in the upcoming U.S. presidential election.

This political backdrop has only intensified the allure of Bitcoin for investors, particularly as the ETF landscape evolves.

The Position of Major Players in the Market

Currently, the second-largest holder of Bitcoin is Binance, which reported approximately 636,000 BTC in its Proof of Reserves as of 1 October.

Source: Binance

It’s important to note that most of these holdings likely belong to customers rather than the exchange itself.

Following closely behind, BlackRock’s iShares Bitcoin Trust (IBIT) manages 396,922 BTC on behalf of its clients, positioning it as a key player in this rapidly changing landscape.

Could Supply Constraints Drive Bitcoin Prices Higher?

As U.S. Bitcoin ETFs continue to absorb significant amounts of BTC, analysts are raising the possibility of supply constraints emerging.

This dynamic could create upward pressure on Bitcoin's price, particularly as institutional demand grows.

Eric Balchunas, a senior ETF analyst at Bloomberg, shared his insights on social media, indicating that the ETFs are “97% of the way to holding 1 million BTC, and 87% of the way to passing Satoshi as the biggest.”

He plans to discuss these trends further at the upcoming Plan B conference in Lugano.

The current market conditions suggest a bullish outlook for Bitcoin.

Edmondson highlighted a liquidation heatmap that indicates strong potential for price appreciation.

He remarked,

“If BTC price reclaims $68,089.74, $40.79 million shorts will be liquidated.”

This could result in a price surge as traders are compelled to buy back their positions to mitigate losses.

How Is Bitcoin Performing Right Now?

As of writing, Bitcoin's price has surged by 12.5% over the past two weeks, climbing to $67,965.66.

The interplay between the rising ETF holdings and Bitcoin’s performance on the market presents a compelling narrative for investors.

With these developments, many are left to ponder: how high can Bitcoin rise as institutional interest continues to build?