Bitcoin spot ETF inflows break records and drive the market!

Thought of the week

After the Bitcoin ETF issue brought about a certain price change before the ETFs were finalised – market participants are positioning themselves early in order to then “sell the news”. The same could now happen with Ethereum, as ETFs could (without any guarantee) also follow in the US this half-year. This would mean similar cycles for Ethereum as for Bitcoin a few months ago.

Digital Asset News

MicroStrategy, the largest non-financial company that owns Bitcoin, is slowly approaching inclusion in the major S&P 500 stock index – a milestone that could soon lead to Bitcoin indirectly appearing in “almost every portfolio”.

However, the Bitcoin-focused company would first have to meet strict admission criteria and record a strong increase in its own market capitalisation in order to be included.

The data shows that on 15 February, MicroStrategy climbed to 535th place among the largest listed companies in the United States, after the software manufacturer’s share price had previously risen by a whopping 46% within eight days.

Even if all the criteria are met, the 11-member S&P Executive Committee would still have to approve MicroStrategy’s inclusion and give the final green light. The committee even temporarily removed the highly successful electric car manufacturer Tesla from the S&P 500 ESG Index in May 2022, which provided evidence of how strict its requirements are.

The influential index fund is rebalanced on the third Friday in March, June, September and December.

According to Joe Burnett, Senior Product Marketing Manager at crypto-financial services provider Unchained, if MicroStrategy seeks inclusion in the S&P 500 and is successful, this could have a “massive positive feedback effect” for investments in BTC.

Several major banks and financial institutions in the United States are pushing the U.S. Securities and Exchange Commission (SEC) to adjust its definition of crypto assets, which would allow them to play a larger role in the crypto economy, such as custodians for the recently approved Bitcoin exchange-traded index funds (ETFs).

On 14 February, a coalition of financial industry lobbying groups comprising the Bank Policy Institute, the American Bankers Association, the Financial Services Forum and the Securities Industry and Financial Markets Association outlined their position in a letter to SEC Chairman Gary Gensler.

In it, the group pointed to the recent approval of said Bitcoin ETFs in the U.S. and noted that American banks are on the outside of the approved products as asset custodians.

“The regulator has recently approved 11 Bitcoin spot ETFs that allow investors to access this asset class through a regulated product. However, these authorised products lack banking institutions that act as custodians of the assets, a role they regularly play for most other ETFs.”

The letter therefore asks the SEC to consider amendments to Staff Accounting Bulletin 121 (SAB 121), which was issued in March 2022 and provides guidance on accounting for crypto assets.

The Bitcoin price has been hovering around the USD 52,000 mark over the past few days, while the new US economic data is surprisingly strong. Just two days after the publication of the Consumer Price Index (CPI) for January, the new figures for the Producer Price Index (PPI) for the same month were published yesterday, which did nothing to alleviate concerns about the further development of US monetary policy.

Compared to the previous year, the PPI stands at 0.9%, which is slightly lower than the previous month but still 0.3% higher than expected.

Together with similar results for the CPI, hopes that the US central bank could soon lower the key interest rate are dwindling.

According to the CME Group’s FedWatch tool, the probability of a cut at the central bank’s next meeting in March has accordingly fallen from 17.5% to just 8.5%. Nevertheless, the Bitcoin price reached an interim high of USD 52,884 the previous day.

In the 4-hour chart, the popular trader Skew points out the importance of the 21-period Exponential Moving Average (EMA), which is located at USD 51,000. Meanwhile, the “direct” Bitcoin index funds (ETFs) recorded almost half a billion dollars in inflows on 15 February,

This builds on an impressive week in which ETFs literally got a “second wind” more than a month after their authorisation.

Digital Asset Market

The majority of digital assets once again experienced a positive trend and significant gains last week. Altcoins in particular were able to push bitcoins into the limelight in the weeks-long upswing and outperform for the first time in a while. Ethereum should be emphasised here, as the possible ETFs that could come in May will serve the same narrative as Bitcoin a few months ago and could lead to further bullish cycles. In technical news terms, it was another “quieter” week, which means that the price developments are largely due to the positive and record-breaking institutional inflows!

On a weekly basis, the overall market performance was again positive at 9.8%.

The message for the coming week is: If Bitcoin establishes the $50,000 mark as support, further upswings could follow quickly!

Chart technicals

From a chart perspective, Bitcoin is now trading around the resistance levels formed last week at ~$52,500 and is holding this level without any major sell-offs. This suggests that there is currently little selling pressure or that it will be bought up quickly with more volume (Bitcoin spot ETFs). Altcoins can often make larger movements in this “positive consolidation”, but major setbacks are not yet expected. A renewed breakout from this price range could start a new cycle this week.

The next price targets in the event of a positive development: ~$53,800, ~$54,500, ~$56,250

The next price targets in the event of a negative development: ~$51,000, ~$49,700 ~$47,000

Trading idea

Another bullish breakout would be a good market situation to cautiously increase Bitcoin positions or invest in altcoins that have not yet risen sharply but have certain correlations with other tokens and coins. The development of Ethereum (ETH) in particular should be kept an eye on!

Weekly overview

As usual, we are also providing detailed videos for those who want to delve deeper into the subject.


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