- Bitcoin ETFs see significant inflows, sparking concerns about potential local top patterns
- ETF demand impacts spot prices differently due to large OTC desk balances in 2024
- Analysts anticipate Bitcoin may soon return to price discovery in US dollar terms
Bitcoin faces cautious optimism as institutional interest surges, driven by record inflows into U.S. spot Bitcoin ETFs. Analyst Mark Cullen noted on October 30 that while ETF inflows have reached nearly $900 million — marking the second-largest daily total — past trends hint at potential challenges ahead for Bitcoin’s price. Cullen pointed out that large inflows at similar levels previously coincided with BTC price consolidation, signaling local tops.
ETF Inflows and Market Reactions
Despite the robust ETF inflows, Bitcoin prices showed limited immediate movement. Data from CryptoQuant highlighted that over-the-counter (OTC) desk availability plays a significant role in moderating spot price effects from large ETF purchases. The report stated that daily ETF Bitcoin acquisitions now account for only 1% to 2% of total OTC balances, a notable decrease from the 9% to 12% share observed earlier in 2024.
Analysts noted that Bitcoin’s OTC desk balance, which once increased rapidly, has slowed. The 30-day change in OTC balances currently stands at around 3,000 BTC, compared to significant growth seen in June and August 2024.
Outlook on BTC Price Discovery
Bitcoin hovered near $72,000 as of October 31, per TradingView. William Clemente from Reflexivity Research emphasized that major ETF holders, now seeing profits, could further promote their positions within financial circles, likening the current ETF interest to earlier trends in gold.
Bloomberg ETF analyst Eric Balchunas observed that the cumulative Bitcoin holdings by ETF providers are expected to surpass 1 million BTC soon. He noted that BlackRock’s iShares Bitcoin Trust (IBIT), which has grown to $30 billion in assets in just 293 days, has been an instrumental part of this rapid accumulation.
