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The world’s largest cryptocurrency may be at risk Presentation shock As demand from Bitcoin ETFs in the United States (US) rises far beyond expectations. In December 2024, the BTC volume was obtained by Bitcoin ETFs The quantity extracted during the same month more than tripled, which confirms the severe imbalance between supply and demand.
Spot Bitcoin ETFs raise the risk of a supply shock
In December 2024, Bitcoin ETFs were released in the United States Purchased An amazing 51,500 Bitcoin. On the other hand, Bitcoin miners produced only 13,850 coins during the same period, according to Bitcoin.com. Data From Blockchain.com. This indicates that Bitcoin ETFs alone bought nearly four times the amount BTC Miners It was produced and supplied to the market that month.
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according to ReportsDemand for ETFs in December was less than exceptional, outstripping available supply by about 272%. This is huge Increasing demand for spot Bitcoin ETFs Concerns have been raised about a potential shock to Bitcoin supplies, with analysts suggesting this could happen soon.
Specifically, Lark Davis, a cryptocurrency analyst, Announce earlier in December that a “massive supply shock is imminent”. The analyst based this alarming forecast on the significant accumulation of BTC from Bitcoin ETFs in the US. Davis revealed that at one point in December, Bitcoin ETFs had purchased 21,423 Bitcoin; Meanwhile, miners produced only 3,150 bitcoins at around the same time.
Analyst too male Bitcoin ETFs globally hold approximately 1,311,579 Bitcoin as of December 17, 2024. This amount, valued at $139 billion, represents 6.24% of the total Bitcoin supply of 19.8 million. Given this staggering number, Davis predicts that during the peak phases of a bull market, spot Bitcoin ETFs could hold 10-20% of Total supply of BTC Which raises further concerns about a major supply shock.
Concentration of Bitcoin spot inflows in December
Data Glassnode revealed that Spot Bitcoin ETFs recorded a total net inflow of $4.63 billion in December, nearly double their 2024 monthly average of $2.77 billion. It is worth noting that Glassnode revealed the increase in… Bitcoin ETF Instant Flows It was more concentrated during the first half of the month, while the second half witnessed Outflowswith December 26 being the exception.
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The timing of this boom and its aftermath is not surprising Bitcoin ETF inflows decline In line with BTC price movements in December. At the beginning of the month, Bitcoin saw upward momentum, rising to… New ATH above $108,000 on December 17, driven by bull market noise and high demand. However, after this peak, The price of BTC saw a sharp declinea decline that coincided with the timing of significant outflows from spot bitcoin ETFs, according to Glassnode.
Despite a spike in demand for spot Bitcoin ETFs in December, new… Data It shows that investors have extended their accumulation trend into January 2025. On January 3, investors purchased over $900 million worth of Bitcoin through Spot Bitcoin ETFs. Recently, US spot bitcoin ETFs acquired an additional 9,500 bitcoins, worth more than $966 million at the current market price.
Featured image created with Dall.E, chart from Tradingview.com