Written by Matteo Greco, Research Analyst at the publicly listed digital asset and fintech investment business Fineqia International (CSE:FNQ).
Bitcoin (BTC) closed the week at around $68,400, marking a slight 0.8% decrease from the previous week’s closing price of approximately $69,000. The week was characterized by significant volatility, with BTC experiencing a price range of 13.4%. The week started strong as BTC surged to $72,000 on Monday and reached a new all-time high of nearly $73,800 on Thursday, following peaks of over $73,000 on both Wednesday and Thursday.
However, on Thursday, BTC saw a sharp decline to $68,000 before bouncing back to close around $71,400. Selling pressure persisted on Friday and Saturday, pushing BTC to trade as low as $64,700 and closing Saturday near $65,300. Positive momentum returned on Sunday, nearly recovering the weekly loss and closing around $68,400.
Despite the price fluctuations, BTC Spot ETFs continued to show strong momentum, with net inflows recorded every trading day. The weekly net inflow exceeded $2.5 billion, with Tuesday alone seeing a net inflow of over $1 billion. The total net inflow since inception now stands at around $12.2 billion.
Trading volume for BTC Spot ETFs also increased, with total trading volume reaching $141.7 billion since inception, including almost $28 billion traded in the last week. This led to a daily trading volume of over $5.5 billion during the previous week, contributing to an average daily volume since inception of approximately $3.15 billion.
These numbers highlight the sustained interest from traditional finance in the digital assets sector. While BTC’s price remained relatively stable last week, demand was driven mainly by ETFs, while native digital assets investors were more active in selling.
This trend is evident in the decrease of BTC held by long-term holders, defined as BTC that has not moved for at least 155 days. At the beginning of 2024, this supply was nearly 16.3 million BTC, decreasing to about 15.1 million BTC currently. This shift indicates traditional investors are driving buying activity through ETFs, while native digital assets investors who accumulated during the downtrend in 2022 and 2023 are now taking profits at a higher rate, reducing the supply held by long-term holders.
This behavior is typical in early bull phases, where long-term holders distribute assets to new investors. If the current market continues its uptrend, following past cycles, this pattern could persist until the supply from long-term holders aligns with the demand from new investors, typically marking the cycle’s peak and the start of a downtrend.
Notably, the BTC halving is about a month away, historically preceding cycle peaks between 6 and 12 months later. If historical patterns repeat, the peak of the current cycle could occur in late 2024 or the first half of 2025.
