Bitcoin reached its all-time high for the fourth time in six days. This was largely due to a record influx of funds into exchange-traded funds (ETFs) linked to the first cryptocurrency in the United States.
The world's largest cryptocurrency peaked at $73,678.86 (according to CoinDesk), and then its rate fell slightly – to approximately $73 thousand at the time of writing. Meanwhile, daily inflows into US spot Bitcoin ETFs exceeded $1 billion, according to Bloomberg. At the same time, BlackRock's IBIT spot exchange-traded fund set its own record of $849 million in a day.
“The reason for this jump is obvious – the huge demand for physically-backed ETFs and the low depth of the market. As issuers buy huge volumes of Bitcoin to back their ETFs, the overall supply continues to shrink,” said Manuel Villegas, a digital asset analyst at Swiss private bank Julius Baer.
According to Villegas, the weekly issuance of 6,300 units of Bitcoin is “negligible” compared to the demand for cryptocurrency exchange-traded funds, which has reached 40,000 Bitcoins in recent weeks. Also note that earlier this week, Bitcoin's total capitalization exceeded $1.3 trillion, which exceeds the total market value of silver.