The recent launch of spot exchange-traded funds (ETFs) for Bitcoin has led to the accumulation of over 192,000 bitcoins in holdings, signaling a strong investor appetite for cryptocurrency exposure through traditional investment vehicles. According to CryptoQuant, if the current influx of ETF-related buying persists, Bitcoin prices might soar as high as $112,000.
CryptoQuant’s analysis on Sunday highlighted that the consistent inflows into spot Bitcoin ETFs could have a substantial impact on the cryptocurrency’s valuation. CEO Ki Young Ju suggested a “worst-case” scenario where Bitcoin could still see a significant increase to at least $55,000, marking a roughly 15% rise from its current trading levels.
The optimistic price targets are based on the interplay between ETF inflows, Bitcoin’s market capitalization, and a specific metric ratio used to gauge whether the asset is overvalued or undervalued. Ki pointed out the robust ETF inflows, amounting to $9.5 billion per month, could amplify Bitcoin’s realized capitalization by $114 billion annually. This influx comes despite outflows from other vehicles such as GBTC, indicating a potential elevation in Bitcoin’s realized cap from $451 billion to between $527 and $565 billion.
The ratio of Bitcoin’s market capitalization to its realized capitalization has been a reliable indicator of price peaks in the past. With current trends, this ratio may signal a top between $104,000 to $112,000, historically a level associated with market highs.
Spot Bitcoin ETFs, despite being on the market for less than a month, have already garnered significant attention, attracting billions of dollars from investors who prefer not to engage directly with cryptocurrency purchasing and storage. This trend underscores the merging paths of traditional finance and digital assets, painting a bullish picture for Bitcoin’s journey on the financial markets stage.
