Bitcoin ETF issuers bought almost 4 times more BTC in December than they issued. What does that mean?
On January 11, 2024, Bitcoin spot ETFs began trading in the United States. The event was significant because such instruments allowed a huge number of investors, financial institutions, and even banks to get involved with cryptocurrencies. Since then, net capital inflow into BTC ETFs has amounted to $36.89 billion — and this is despite the withdrawal of $21.44 billion from Grayscale ETFs. In any case, crypto funds never cease to amaze.
Analysts expect even better results from Bitcoin ETFs in the new year. For example, Bernstein experts published ten forecasts for the crypto market in 2025, and one of them touched on the topic of crypto ETFs.
The staff estimates that BTC spot ETFs will attract $70 billion in net capital inflows over the next twelve months, roughly double the 2024 total.
Until this happens, the situation with investment instruments already indicates a serious demand for Bitcoin.
Latest Bitcoin ETF News
According to Apollo and BiTBO, issuers of BTC spot ETFs purchased 51,500 coins in December. This is 3.7 times the number of bitcoins that the network issued in the form of rewards for miners during this period . Accordingly, the new supply of cryptocurrency does not cover investor demand for shares of ETFs.
Bitcoin Purchases by US Cryptocurrency ETF Issuers
It is important to understand that Bitcoin ETF issuers like BlackRock and Fidelity do not purchase coins for their own holdings. Since ETFs are spot funds, they are based on regular BTC. Therefore, when investors want to buy such shares, companies are forced to back them by buying more and more cryptocurrency.
And when market participants dump their shares, the giants also dump their coins, which obviously affects the asset’s price.
Cryptocurrency purchases have helped BTC rise to new highs. The coin’s current record price is $108,353 on December 17, 2024.
Daily chart of the Bitcoin BTC rate on the Binance exchange
According to the Blockchain-com platform, 13,850 new coins were created in the Bitcoin network in December. This means that demand from ETFs alone exceeded the new supply by 272 percent, representatives of Cointelegraph report .
At the same time, MicroStrategy, which remains the largest holder of bitcoins among public companies, was actively buying up coins throughout December. As of today, the giant has accumulated 447,470 BTC, which is currently valued at $45.6 billion.
Public Companies With the Largest Bitcoin Holdings
Onramp Bitcoin co-founder Jesse Myers said that “at current prices, the available supply of BTC is not enough to meet demand.” This could lead to an increase in the cryptocurrency’s price in accordance with the law of supply and demand .
Ripple CEO Brad Garlinghouse confirms the growing interest in crypto from major investors. According to him, this is happening due to the upcoming inauguration of Donald Trump, which will take place on January 20, 2025.
Ripple CEO Brad Garlinghouse
Earlier, the politician promised to approve adequate regulation for the digital assets sector and even create a national Bitcoin reserve. Given this, major players are ready to interact with crypto without fear of possible problems with regulators.
Here’s Garlinghouse’s take on traditional finance’s attitude toward crypto during Joe Biden’s presidency, as reported by Decrypt .
They didn’t want to get involved in this fight. Cryptocurrency was just another headache for them that they didn’t want to deal with.
And since the newly elected president has already identified pro-crypto candidates for important posts after winning the election, Wall Street representatives received a clear signal about the opportunity to work with the coin sphere. Recall that they were the next SEC chairman Paul Atkins and the person responsible for AI and cryptocurrency policy David Sachs.
When you interact with them now, they clearly understand where everything is going. The risks of working with companies like Ripple are now several times lower.
Trump’s election victory has also had an impact on what’s happening inside Ripple. As Brad notes, the company is currently hiring for 70 new positions in the US, which means that about 75 percent of the giant’s vacancies are in America.
Newly elected US President Donald Trump
This is a complete reversal of the situation in recent years, when employees were predominantly hired overseas due to possible problems with American regulators. Here is another response from Garlinghouse, this time about the health of the coin industry.
This is not measured only by cryptocurrency rates. It is also necessary to take into account the specifics of hiring and signed contracts. These are the details that drive the economy. And they became noticeable even before Trump took office.
Statistics confirm that demand from crypto investors is significantly outpacing the new supply of Bitcoin. Of course, there are plenty of BTC available on exchanges that can be purchased. However, the trend is still about the coins becoming internationally recognized assets, and it is only just emerging.
