Bitcoin News Today: Institutional Demand and ETF Inflows Push Bitcoin to $124K as Supply Compresses

Bitcoin surged to a new all-time high of $124,457 on October 5, 2025, driven by record inflows into U.S. spot Bitcoin exchange-traded funds (ETFs) and growing institutional demand. The week ended October 3 saw $3.24 billion in ETF inflows, the second-highest since their launch in January 2024, with BlackRock's iShares Bitcoin Trust (IBIT) and Fidelity's FBTC accounting for the bulk of the $3.24 billion. This influx has tightened Bitcoin's circulating supply, with analysts estimating that ETF demand could absorb over 100,000 BTC in Q4 2025, nearly double the network's quarterly issuanceBitcoin ETFs Surge $3.2B in Inflow as “Uptober” Month Unfolds^[3]. The price rally was further supported by reduced short positions, as over $313 million in leveraged shorts were liquidated in the week, signaling a potential short squeeze.

The U.S. government shutdown, which began October 1, has intensified demand for alternative stores of value. With 750,000 federal workers furloughed and non-essential services suspended, political dysfunction has accelerated capital flight into assets like Bitcoin and gold. Gold prices reached $3,895 per ounce, while Bitcoin's price correlation with gold-now at 0.64-suggests BTC could follow gold's trajectory. Analyst Ted Pillows noted that Bitcoin typically lags gold by eight weeks, implying further gains as gold remains near record highsBitcoin ETFs Gain $430M Amid US Shutdown Fears^[1].

Institutional adoption has deepened, with on-chain data revealing increased accumulation by long-term holders. Wallets holding 10–1,000 BTC have grown their holdings, reducing exchange liquidity to levels last seen before the January 2024 ETF approvals. Meanwhile, major miners like Marathon Digital and Riot Platforms have expanded operations by 15–20% quarter-over-quarter, with some holding BTC on balance sheets, further constraining supplyBitcoin ETF Inflows Hit $3.24B: BTC Nears $124K as “Uptober” …^[4].

Technical analysis supports a bullish outlook. Bitcoin has reclaimed the $120,000 level and is testing resistance at $125,000, with Fibonacci extension targets suggesting a potential move to $135,000–$138,000. Analysts like Geoff Kendrick of Standard Chartered and Cas Abbe predict a Q4 breakout, with Kendrick targeting $135,000 and Abbe suggesting October could see a new ATHBitcoin ETFs Gain $430M Amid US Shutdown Fears^[1]Bitcoin ETFs Surge $3.2B in Inflow as “Uptober” Month Unfolds^[3]. The "Uptober" seasonality effect, historically marked by 20% average monthly returns for Bitcoin, has reinforced optimism, with October 2025 already showing a 1.75% 24-hour gainBitcoin ETFs Surge $3.2B in Inflow as “Uptober” Month Unfolds^[3].

Despite short-term volatility, the structural bull case remains intact. ETF inflows, supply compression, and dovish Fed expectations have created a favorable environment for Bitcoin. Citi's Alex Saunders highlighted ETFs as the primary catalyst, noting that flows into digital asset treasuries could persist through year-end. However, he warned that macroeconomic shifts-particularly equity market corrections-pose the greatest risk to continued gains.

Bitcoin's surge to $124,457 underscores its evolving role as a macroeconomic hedge. With institutional demand outpacing miner supply and geopolitical uncertainty driving safe-haven flows, the asset is positioned to challenge $139,000 in Q4. The interplay of ETF accumulation, on-chain strength, and historical seasonality suggests a sustained rally, though investors must remain cautious of liquidity dynamics and regulatory developments.