The post Bitcoin ETFs Approach 6% of Market Cap as Institutional Demand Surges Amid Low Exchange Reserves appeared on BitcoinEthereumNews.com.

Bitcoin ETFs are poised to hold approximately 6% of Bitcoin’s total market capitalization as institutional interest surges amidst dwindling supply. As Bitcoin (BTC) prices continue to rise, the drop in reserves on spot exchanges raises questions about future price movements and potential supply constraints. According to analysis from CoinDesk, “The rapid decrease in Bitcoin available on exchanges could lead to a significant price squeeze if demand continues to outstrip supply.” Bitcoin ETFs nearing 6% of total BTC market cap amid declining supply could signal impending price squeeze. Read more about recent market trends. Bitcoin Spot Exchange Reserves Hit a 7-Year Low Recent data from CryptoQuant indicates that Bitcoin’s supply on spot exchanges has plummeted to a record low not seen since mid-2018. Currently, there are approximately 1,055,716 BTC held on spot exchanges, reflecting a remarkable decrease amid Bitcoin’s rally surpassing $100,000. As Bitcoin experiences significant gains, data from 10X Research highlights that major exchanges are witnessing substantial Bitcoin outflows. For instance, Coinbase reported a staggering 72,000 BTC outflow in the past month, making up nearly 10% of its total BTC reserves, while Binance saw 29,000 BTC withdrawn. Meanwhile, Kraken also faced outflows exceeding 7% of its holdings. This pattern leads to clear evidence of market participants’ reluctance to sell, with over 22 days of negative netflows observed recently. This suggests that the sentiment among traders remains bullish, contributing to the dwindling supply on exchanges. Overall, this trend signifies a growing reluctance to sell among Bitcoin holders, indicating a long-term bullish sentiment in the market. Rising Institutional Demand In parallel with dwindling supply, institutional demand for Bitcoin has intensified, mainly illustrated through inflows into spot Bitcoin exchange-traded funds (ETFs). Notably, data from SoSoValue indicate that inflows to these ETFs have exceeded $5 billion over the last three weeks, inching closer to…

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Filed under: News - @ December 14, 2024 9:09 pm