Bitcoin ETFs See $1 Billion Inflow as Institutional Interest Surges

Bitcoin ETFs have experienced a significant inflow of $1 billion over the past week, marking the tenth consecutive week of such inflows. This trend highlights the growing institutional interest in Bitcoin as a mainstream investment vehicle. BlackRock's IBIT led the way with a substantial inflow of $1.23 billion, while other notable ETFs such as Bitwise's BITB, Grayscale's Bitcoin Mini Trust, and Hashdex's DEFI fund also saw inflows of $29.85 million, $14.93 million, and $1.17 million, respectively.

The sustained inflow into Bitcoin ETFs can be attributed to several factors, including easing geopolitical tensions and the Iran-Israel ceasefire. These developments have contributed to a positive market sentiment, encouraging investors to view Bitcoin as a stable and attractive investment option. BlackRock's IBIT, in particular, has been a standout performer, with inflows exceeding $2.6 billion since early June, securing nine consecutive days of inflows. This dominance underscores the growing institutional conviction in Bitcoin and the supply-driven bullish dynamics at play.

Bitcoin and crypto funds have continued to attract inflows, with a total of $1.24 billion added recently, pushing year-to-date totals to $15 billion. Despite holiday lulls and global uncertainties, investors are seizing the pullback as a buying opportunity rather than a sell signal. Bitcoin alone attracted $1.11 billion in weekly capital inflows, boosting its monthly total to $2.37 billion and year-to-date haul to $12.7 billion. This is backed by nearly $152 billion in assets under management, according to CoinShares data. These metrics paint a bullish picture for Bitcoin as more institutional and retail investors continue to embrace the cryptocurrency.

Bitcoin’s illiquid supply, which refers to the portion of coins held in wallets that rarely move, has reached 14.37 million BTC, up from roughly 13.9 million BTC at the start of the year. This represents a rise of 470,000 BTC year-to-date. Over 72 percent of the circulating Bitcoin supply is now effectively “off-market,” held by long-term investors and cold wallets. This historic peak in illiquid supply is driven by two reinforcing trends: record accumulation in recent months and the absorption of newly mined BTC by corporate treasuries and U.S. spot Bitcoin ETFs.

Over the past 30 days, around 180,000 BTC moved into illiquid wallets, the strongest monthly shift since December 2022. Entities holding 10–10,000 BTC, known as “whales & sharks,” added 83,000 BTC, while small retail investors offloaded a few hundred. Institutions and ETFs are mopping up newly mined BTC almost as fast as they are released, sometimes even exceeding miner issuance. This trend reduces sell-side pressure, heightens scarcity, and reflects the maturing market of Bitcoin as a “digital gold” rather than a speculative asset.

The rising illiquid supply trend is a bellwether of investor conviction and may predispose Bitcoin toward sustained upward momentum. While cyclical pullbacks remain possible, fewer coins available for trading mean any demand spike might have an outsized impact on price. This trend, coupled with the significant inflows into Bitcoin ETFs, has the potential to send the apex cryptocurrency to a new all-time high above the present price of $107,104. The tightening float points to mounting scarcity, setting the stage for potentially bullish price dynamics in the months ahead.