Bitcoin's $68K Surge: $507M Spot ETF Inflow Drives $170B Market Add

Bitcoin's price action was explosive, climbing from lows near $62,400 to a weekly high of $69,500 in a single day. This surge added a staggering $170 billion to the total crypto market cap in just 24 hours, marking one of the largest single-day gains on record. The move followed a period of extreme pessimism, with the Bitcoin Fear & Greed Index hitting a record low of 5 just days prior.

The rally is a direct response to a powerful, spot-driven liquidity event. After five consecutive weeks of redemptions totaling $3.8 billion, US-traded spot Bitcoin ETFs recorded net inflows of $257.7 million on February 24. This reversal in institutional demand provided the foundational buying pressure that fueled the price recovery.

This flow event reset the market's leverage. Derivatives data shows aggregated open interest has fallen, indicating a cleansing of excessive positions. The combination of a massive inflow of new capital and a market that had shed its speculative debt created the conditions for a clean, spot-driven rally rather than a leveraged euphoria spike.

The Primary Liquidity Source

The primary source of the new buying pressure is a massive, concentrated ETF inflow. On February 25, spot Bitcoin ETFs saw a net inflow of $507 million, marking the end of five consecutive weeks of redemptions. This single-day event is the clearest signal of institutional capital returning to the market.

BlackRock's IBIT was the dominant driver, contributing $297 million of that total. This inflow brings its historical net inflow to over $61.5 billion, underscoring its role as a major liquidity engine. The total net asset value of all spot Bitcoin ETFs now stands at $87.6 billion, representing a significant 6.34% of Bitcoin's total market cap. This scale of capital is a powerful new source of demand.

The sustainability of this flow hinges on the shift in U.S. market dynamics. The inflow coincides with the Coinbase Bitcoin Premium Index turning positive, ending two months of negative trading. This index shows Bitcoin's price on the U.S. exchange Coinbase now exceeds the price on Binance by over $10, a clear signal of rising domestic demand that ETFs are well-positioned to capture.

Market Structure Reset

The rally's foundation appears stable, not fragile. A key indicator is the sharp drop in aggregated Bitcoin futures open interest to approximately 235,167 BTC. This marks a clear reduction from prior highs above 240,000 BTC, indicating the market has already shed a layer of excessive leverage during recent volatility. This cleansing is a prerequisite for a sustainable, spot-driven move.

Funding rates support this view of a reset. They remain slightly negative at minus 0.0037 percent, meaning short positions are still paying longs. This neutral-to-negative environment signals the market is not yet overheated with speculative long bets, reducing the risk of a violent unwind.

This structural reset is occurring alongside broader risk market stabilization. The rally coincides with improved investor sentiment from positive corporate earnings and political signals that reduced policy uncertainty. This macro backdrop provides a supportive environment for Bitcoin to trade on its own fundamentals, rather than being dragged down by a collapsing equity market.