Will Bitcoin Reach New Highs This Month?

Analysts have indicated that the macroeconomic environment continues to evolve in a direction favorable to cryptocurrencies.

The U.S. Bitcoin ETF has recorded net inflows for 18 consecutive days, an unprecedented phenomenon, with surging demand propelling the world's largest digital currency close to its all-time high.

According to data compiled by Bloomberg, since its launch on January 11th up to this Thursday, nearly a dozen spot Bitcoin ETFs have cumulatively attracted $15.6 billion in net subscriptions, with total assets under management reaching $62.3 billion.

Bitcoin funds from companies such as BlackRock and Fidelity Investments have secured a place among some of the most successful debuts in ETF industry history.

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They have shaken Wall Street, shifting the center of gravity for cryptocurrencies from Asia to the United States.

Many speculators in the options market anticipate that Bitcoin will surpass the historical peak of $73,798 set in March this month, thanks to the boost from demand for spot Bitcoin ETFs and expectations of an upcoming interest rate cut by the Federal Reserve.

Sean Farrell, Head of Digital Asset Strategy at Fundstrat Global Advisors LLC, wrote in a report, "There has been a substantial influx of capital into spot Bitcoin ETFs.

The macroeconomic environment continues to move in a direction beneficial to cryptocurrencies, with economic growth slowing but not entering a recession, and signs of disinflation persisting."

Last week, BlackRock's $21.4 billion iShares Bitcoin Trust became the world's largest Bitcoin fund, surpassing Grayscale Investments' $20.1 billion Bitcoin Trust.

The $12.3 billion Fidelity Wise Origin Bitcoin Fund ranks third.

After a court ruling in 2023, the U.S. Securities and Exchange Commission (SEC) reluctantly allowed spot Bitcoin ETFs to be listed in January.

Surprisingly, the agency also began leaning towards approving funds for the second-largest cryptocurrency, Ethereum, in May.

Under the leadership of SEC Chairman Gary Gensler, the agency has generally taken a critical stance towards the digital asset industry for alleged regulatory violations.

Recently, efforts by Congress to bring some legislative clarity to cryptocurrencies have accelerated.

Ophelia Snyder, President of 21 Shares AG, a cryptocurrency ETF provider, stated that the adoption of digital asset funds is still in its infancy for institutions and intermediaries.

She said, "The market has a long way to go; we are still in the early stages."

Since the beginning of last year, the price of Bitcoin has more than quadrupled.

This surge has faded the memory of the painful bear market in 2022, when the market exposed many fraudulent acts and led to the imprisonment of once highly regarded entrepreneurs like Sam Bankman-Fried.