ETFs Absorb 9 Times the Mining Output…Bitcoin Supply Shock is Coming!

▲ Bitcoin (BTC) Exchange Traded Fund (ETF) ©CoinReaders

While Bitcoin wavers in the mid-$70,000 range, spot Bitcoin ETFs and corporate buying are absorbing nine times the mining output, increasing supply pressure.

According to the investment media TradingNews on April 29 (local time), Bitcoin (BTC) traded between $75,705 and $77,000, falling 0.91% during the day. However, unlike the spot price, institutional fund flows were strong. In the most recent reporting period, spot Bitcoin ETFs recorded a net inflow of $823 million, with BlackRock's iShares Bitcoin Trust (IBIT) accounting for most of the inflows.

IBIT's assets under management were approximately $54 billion, and its holdings were estimated at about 810,000 BTC. The continuous inflow for 8 consecutive trading days until April 23 amounted to $2.1 billion, with approximately 75% of this flowing into IBIT. The total assets under management for all US spot Bitcoin ETFs exceeded $102 billion, and the cumulative net inflow since their launch in January 2024 reached $58 billion.

The pressure on the supply side is even clearer. After the halving, the new Bitcoin issuance is around 450 BTC per day, but the amount absorbed by ETFs over 8 days was approximately 19,000 BTC. During the same period, only about 2,100 BTC were mined, meaning ETF demand was approximately nine times the new supply. Additionally, Strategy invested $2.54 billion in the same week to purchase an additional 34,164 BTC, increasing its total holdings to 815,061 BTC.

However, cracks also appeared in the short-term flow. On April 28, a net outflow of $89.68 million occurred across all spot Bitcoin ETFs, and IBIT also recorded a net outflow of $112.25 million. The media interpreted this as a sign closer to tactical rebalancing rather than a structural exit, but pointed out that if net outflows continue for more than three trading days, it could be seen as a sign of slowing institutional demand.

In terms of price, the most important range is $80,000 to $80,100. This range is where the average purchase price of short-term holders is concentrated, serving as a resistance level where many recent buyers reach their break-even point. If Bitcoin breaks through this range with volume, the possibility of reaching $90,000 and further re-testing the previous all-time high of $126,080 is raised. Conversely, if it fails to break $80,000, the $72,000-$74,000 range is mentioned as a key buying defense line.

The media assessed that the Iran war, surging oil prices, and the Federal Reserve's (Fed) stance on interest rate freezes remain short-term risk factors. Nevertheless, it analyzed that with ETF funds, Strategy's large-scale purchases, and the expansion of institutional holdings converging, Bitcoin has secured structural buying momentum different from past retail investor-centric cycles.

*Disclaimer: This article is for investment reference only, and we are not responsible for any investment losses based on it. The content should be interpreted for informational purposes only.*