Bitcoin Spot ETF Sees $3.8 Billion Inflow in 3 Weeks…Hits $80,000 and Still "Undervalued"

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

Bitcoin (BTC) surged by 25% in just three weeks, and with $3.8 billion flowing into Bitcoin spot ETFs, market sentiment reversed sharply. However, after breaking $80,000, it retreated to the $77,000 range, putting the sustainability of the short-term rally to the test.

According to the investment media The Motley Fool on September 12 (local time), Bitcoin spot ETFs attracted over $3.8 billion from investors in the past three weeks, marking the best three-week inflow record of the year. During the same period, Bitcoin rose by 25%. However, the media analyzed that the recent surge stemmed more from a drastic reversal in investor sentiment rather than fundamental changes in Bitcoin. Indeed, the Crypto Fear & Greed Index transitioned from 'Fear' to 'Extreme Greed' in just a few days in August.

Two events were identified as the background for the shift in investor sentiment. First, at a high-level meeting with executives from major cryptocurrency companies held at the White House in August, US President Donald Trump fully supported new cryptocurrency market legislation and virtually expressed his support for the US government's large-scale Bitcoin purchases. The explanation is that market sentiment quickly improved as expectations for regulation and government demand emerged simultaneously.

Another factor is the US Treasury's increased long-term bond buybacks. The Treasury expanded its purchases of long-term government bonds to lower borrowing costs, and in this process, the US government's debt, amounting to $40 trillion, once again attracted investors' attention. It is analyzed that if high borrowing costs continue, concerns about the sustainability of massive national debt could grow, and Bitcoin, which has been recognized as an alternative to fiat currency, gained attention as a potential hedge against financial risks.

However, it is uncertain whether the summer rally will continue. After breaking $80,000, Bitcoin gave back some of its gains, falling to approximately $77,000 by mid-September, with the price cited in the article being $77,346. Since it once fell below $60,000 in June, some speculate that it might retest that low point before a full-fledged ascent. The Motley Fool pointed out that if upward momentum does not quickly revive, there may not be enough time to recover $100,000 by the end of the year.

Nevertheless, the media assessed the current price as undervalued from a long-term perspective. The reason is that the fundamental investment thesis for Bitcoin has not changed in the past month, and long-term growth catalysts remain intact. Accordingly, it concluded that if one focuses on the long-term outlook rather than short-term monthly price fluctuations, Bitcoin at the current $77,000 level could be considered a buying target.

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