American investors have thrown fresh cash at Bitcoin exchange-traded funds over the past six days, helping the price of the top cryptocurrency to rise again.
Data from Farside Investors shows that close to $1 billion has been pumped into the funds since Tuesday last week.
The price of Bitcoin was recently trading at nearly $65,860, down slightly over the past 24 hours but up 1% over a seven-day period. The leading cryptocurrency touched a weekly high yesterday of $66,891.
Funds managed by BlackRock, Morgan Stanley, and Grayscale have taken in over $930 million in the six-day streak after weeks of lacklustre flows and sloppy price action.
Bitcoin is currently nearly 50% below its October record of $126,080 after a massive liquidation event, war in the Middle Eastern and inflation all weighed the cryptocurrency down.
Bitcoin upside potential?
Analysts remain wary of digital assets’ future price path as markets reckon with a re-escalation of the Trump administration’s war with Iran and inflation.
European asset management firm CoinShares last week said that while investors are back at putting fresh cash in Bitcoin via the exchange-traded products, other factors may hold digital asset markets from going higher.
“We have said for some time that Bitcoin has probably reached, or is close to, its floor,” James Butterfill, head of research at CoinShares, wrote. “But we see no significant upside potential from here.”
Current macroeconomic headwinds, such as the US bombing Iran and rising oil prices, could see inflation go up again. The price of Bitcoin has typically done well on news that inflation is coming down because investors expect interest rates to come down.
And another report by NYDIG last week claimed that the asset’s current slump is down to supply mechanics rather than risk sentiment.
The report revealed that Bitcoin’s year-to-date performance makes it the worst-performing asset — losing out against US treasuries, silver, and currencies like the Swiss Franc.
It added that if Bitcoin’s price action were to match other drawdowns — like the bear market of 2022 — a “potential cycle low near $38k-$39k” was possible.