The crypto market is once again showing its teeth as the Bitcoin spot exchange-traded fund (ETF) in the United States recorded a massive inflow of $506.5 million in a single day, the highest since early February.
At the time of writing, the price of Bitcoin is currently at $67,082, up 0.12% since it opened early Friday in Asian trading.
The surge comes as Bitcoin price has managed to reclaim the important $68,000 level, thus injecting renewed investor confidence.
After five consecutive weeks of fund outflows totaling $3.8 billion, this week has the potential to be a turning point.
So far, the total weekly inflows have reached $560.4 million.
This signals that the massive selling pressure in February that wiped out about $20 billion in asset value may be easing.
The main player in this revival is BlackRock through its iShares Bitcoin Trust (IBIT), which attracted nearly $297 million in a single day.
Other funds such as Bitwise and Fidelity also recorded positive inflows, while ETF trading volume surged past $4.3 billion, the highest since February 9.
Clearly, interest in Bitcoin is rekindling.
But despite the recovery, the debate over market structure remains heated.
Large trading firms such as Jane Street have been in the spotlight following speculation about the role of market makers and Authorized Participants in the ETF unit creation and redemption process.
The issue has raised concerns about how the ‘price discovery’ mechanism could affect Bitcoin’s actual price.
Furthermore, the concept of ‘paper Bitcoin’, i.e. exposure to BTC without physical ownership, continues to be a sensitive topic.
Concerns over transparency have been heightened following an incident at South Korean exchange Bithumb, which reportedly mistakenly distributed a large amount of BTC that it did not own.
Nevertheless, the strong inflows suggest that investor sentiment is improving.
If this momentum continues, Bitcoin has the potential to further strengthen its position in the mainstream financial markets.
