Bitcoin (BTC-USD) has hit over $50,000 for the first time since late 2021, continuing the recent crypto rallies and seeing gains of over 17% in the past month. With many inflows attributed to the recent approval of spot bitcoin ETF offerings, can bitcoin maintain this run?
Fundstrat Global Advisors Head of Digital Asset Strategy Sean Farrell and Swan Bitcoin Head of Swan Business Dante Cook join Yahoo Finance to discuss bitcoin ETF inflows and give insight into bitcoin's future.
Cook puts the rally into context:
"There are a lot of other factors outside of just the ETF inflows, although that is a massive reason why... you're seeing a lot of this price action because these ETF launches have been historic," Cook says, putting the rally into context. "FBTC, Fidelity's product [and] IBIT, Blackshare's product are number one and two the most successful ETF launches of all time. Just like the Chiefs and Patrick Mahomes won back to back championships, these last two weeks you've seen back-to-back historic levels of inflows in dollars moving into this asset class."
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Editor's note: This article was written by Nicholas Jacobino
- It's been one month since the SEC's approval of Spot Bitcoin ETFs. Since launching, funds have pulled in nearly $3 billion in inflows according to CoinShares. Today, Bitcoin prices briefly topped $50,000 boosted in part by Spot Bitcoin ETF inflows. Joining us now for the latest pulse on all things crypto is Dante Cook, Swan Bitcoin Head of Swan Business along with Sean Farrell, Fundstrat Global Advisors Head of Digital Asset Strategy. Guys, welcome both of you to the program.
And Sean, maybe I'll start with you. It has been, Sean, about a month since the SEC did approve these new Spot Bitcoin ETFs. What have we learned so far, Sean? Granted early days, but what have we learned so far about demand for these new products?
SEAN FARRELL: Well, we have learned that bringing BlackRock into the equation is significant. We've learned that there is demand for these products. And we've also learned that people generally like low cost liquid products over other products that might be more expensive and not track the underlying asset as effectively.
- Dante, is this indeed the reason that we have seen Bitcoin rallying like it has been or are there other factors going on that people should know about?
DANTE COOK: Well, there are a lot of other factors outside of just the ETF inflows. Although that is a massive reason why you're seeing a lot of this price action. Because these ETF launches have been historic. There have been over 5,000 ETFs launched over the last 30 years. And FBTC, Fidelity's Product ibbett Black shares product are number one and number two of the most successful ETF launches of all time.
And so just like the Chiefs and Patrick Mahomes won back to back championships, I mean, these last two weeks, you've seen back to back historic levels of inflows and dollars moving into this asset class. And when you attach that to things like the Bitcoin halving where the supply of overall Bitcoin will get cut in half right around April, I mean, you're seeing a massive inflow of demand, institutional and retail, hitting a supply shock.
So I think there's a lot of different factors there.
- And Sean, I'm curious, Bitcoin jumping to 50,000 first time in more than two years. Sean, where do you think the price heads from here, at least in the near to intermediate term? What are the puts and takes we need to consider?
SEAN FARRELL: Yeah. Look. So we start-- our analysis is based-- we always start with macro. And we saw some potential turbulence heading into the year, thought we were heading higher, our price target for the year was $125. Certainly not in a straight line. But a lot of that turbulence in our view was going to stem from a repricing of the timing and frequency of any potential Fed rate cuts as well as potential upward pressure on the long end of the curve due to any potential increase coupon issuance from the Treasury.
And if we look at what has happened over the past several weeks from right before the ETF launch up through today, we've withstood a pretty constant barrage of negative macro variables. We've had a pretty massive rally in the dollar. We've priced out most of the excessive rate cuts that I just mentioned that I just alluded to. And we also had some movement-- upwards movement at the long end of the curve.
So all that considered, it paints a pretty constructive picture that having just gone through that, being a $50,000, that gives me some confidence that this rally in the near term certainly has some room to run.