Bitcoin ETF Investors Turn Profitable as Price Nears $87,000

Bitcoin Magazine

Bitcoin ETF Holders Back in the Black as Price Barrels Towards $87,000

Holders of Bitcoin exchange-traded funds are profitable once more following the digital asset’s recent upward surge.

In a Monday post on X in New York, Bloomberg ETF analyst James Seyffart noted that the morning rally pushed the average investor above the estimated ETF cost basis of $81,72 for the initial time since January.

Bitcoin climbed past $86,000 even though the Clarity Act, a major piece of crypto legislation, was blocked last week and the Federal Reserve implemented an interest rate hike. The cryptocurrency recently hovered near $86,772 after reaching a peak of $86,837 earlier in the session.

The digital coin’s price currently trades over 30% lower than its all-time high of $126,080 recorded last year.

U.S. Bitcoin ETFs, which are overseen by prominent institutions like BlackRock, Fidelity, Grayscale, and Morgan Stanley, pulled in net positive flows exceeding $6 million last week. Farside Investors data indicates that investors rushed back to purchase product shares on Thursday and Friday, injecting nearly $593 million into these investment vehicles.

The August Bitcoin rally began after the Treasury Department announced plans to at least double the volume of its long-dated bond buybacks, leading to the asset’s strongest week since 2023.

Although Bitcoin achieved a record high in October, that upward trajectory halted later that month when the largest liquidation event in cryptocurrency history wiped out over $19 billion in leveraged positions.

The cryptocurrency extended its decline after the Federal Reserve signaled a lack of urgency regarding interest rate cuts, while investors shifted increasing amounts of capital toward artificial intelligence stocks.

Nevertheless, the coin has since brushed off the Federal Reserve’s shift toward hawkishness as market participants return en masse to the debasement trade.

The U.S. Securities and Exchange Commission greenlit Bitcoin ETFs for domestic trading in 2024, yielding the most successful debut in the history of investment funds.

Investors who were previously discouraged from entering the Bitcoin market by the intricate nature of private keys and cold storage can now purchase exchange-traded shares that track Bitcoin’s market price.

Data from Coinglass shows that these ETFs, which are directed by other leading Wall Street fund managers, currently oversee a combined total of $98.8 billion in assets.