- Bitcoin is generating optimism as it records new highs after two years.
- BTC ETF is becoming a favorable asset on Wall Street.
Bitcoins [BTC] the price reached $50,000, reaching its highest level in more than two years. Meanwhile, US technology company MicroStrategy rose almost 11% on February 12, mirroring the rise in the king coin. The company is known for its support of Bitcoin and owns approximately 190,000 BTC worth approximately $8 billion
According to Michael Saylor, co-founder of MicroStrategy, this milestone is a testament to Bitcoin’s growing popularity as the most sought-after digital asset. During a CNBC TV interviewSaylor highlighted Bitcoin’s unique appeal,
“It is new, digital, global, unique and uncorrelated with traditional risk assets because it does not involve exposure to any particular country, current company, quarterly result, product cycle, competitor. to an employee base or supply chain.”
This independence from conventional market influences makes Bitcoin an attractive addition to investment portfolios.
Pent-up demand for Bitcoin
Saylor emphasized that there has been an accumulated demand for it for a decade BTC Exchange Traded Funds (ETFs). This expectation has now been met, giving mainstream investors access to Bitcoin.
He explained that there was an initial period of rebalancing, during which investors shifted their capital to futures markets, miners, MicroStrategy and ETFs.
After this rebalancing phase, assets stabilized and investors began to realize that the demand for Bitcoin through these ETFs is ten times higher than the supply from natural sellers, mainly miners.
Wall Street loves Bitcoin
In another CNBC TV interviewAnthony Pompliano, founder of Pomp Investments, highlighted the unprecedented performance of ETFs. He pointed out that in the entire history of more than 5,500 ETF launches, no fund has ever reached $3 billion in assets under management (AUM) within the first 30 days.
Both anyway Black rock and Fidelity achieved this milestone, marking a historic first.
He claimed,
“The verdict is in: Wall Street doesn’t just love Bitcoin. They love Bitcoin.”
Pompliano highlighted the remarkable daily net inflows of $500 million into these funds. However, he contrasted this with Bitcoin’s daily incoming supply, which amounts to just 900 BTC about $40 to $45 million.
This discrepancy indicates a demand for the king coin that is 12.5 times greater than the daily production rate.
Impact of ETF on Bitcoin Demand
When asked about the impact of ETFs on this demand, Pompliano suggested there is a lot more buying pressure. This is evident from BlackRock’s $4 billion inflow and Fidelity’s $3.5 billion. Moreover, both Bitwise and 21Shares are expected to reach inflows of around $1 billion soon.
Interestingly, 80% of all BTC in circulation has not moved in the last six months, the executive said, and only about $200 billion is actively tradable. ETFs have absorbed 5% of Bitcoin’s entire tradable supply in just 30 days, making it Wall Street’s favorite asset.
Looking back at the future trajectory of BTC’s value, Pompliano shared that significant demand, along with the upcoming halving, all but guarantees a return to Bitcoin’s (ATH) all-time highs within the next year.