Bitcoin ETFs saw record inflows as miners expanded operations — analysts from H.C. Wainwright link a BTC rally to easing global monetary policies.

According to H.C. Wainwright’s latest report shared with crypto.news, Bitcoin (BTC) closed the week ending September 29 with a 3.2% rise, hitting $65,618. This contrasts with its usual trend, as September is typically a weak month for BTC. 

Historically, September has seen an average 3.7% drop, but this year’s gains suggest a shift. Analysts at the firm link this unusual rise to global central banks easing monetary policy, with 21 rate cuts in September. Such actions often boost BTC prices, as reflected by BTC’s surge after the Fed’s recent rate cut.

That said, crypto markets slumped on Oct. 1 as geopolitical tensions between Israel and Iran triggered a sell-off, causing Bitcoin to drop 3.9% and Ethereum (ETH) to fall over 6%. 

The conflict also impacted crypto-mining stocks, with Marathon Digital and CleanSpark shares declining by about 9% and 6%, respectively.

Spot ETFs and miner performance

According to the analysts, spot Bitcoin ETFs saw over $1 billion in inflows last week, marking the first such weekly inflows since July. This indicates strong investor interest, with $494.4 million arriving on September 27 alone. Since January, these ETFs have accumulated $18.8 billion in total inflows.

Miners also experienced a notable week last week. Mining stocks rallied 15.1% week-on-week as Bitcoin prices rose, leading to higher hash prices — a key metric that indicates miner profitability.

Positive developments in the BTC mining space

Analysts from H.C. Wainwight view the Bitcoin mining industry as poised for growth. Hut 8 began its GPU-as-a-service business, signing a five-year deal with an AI cloud developer. This deal is expected to generate $20 million in annual revenue. 

Meanwhile, Cipher completed its purchase of a new 300 MW mining site in West Texas for $67.5 million, expanding its operations. 

Additionally, Bitdeer tested its second-generation SEAL02 mining chip, hitting key efficiency targets and planning mass production in 2024.

The Bitcoin mid-September rally has slowed down leading up to the end of the month. Although it ended September at a green monthly candle close, the cryptocurrency has fallen below the psychological $65,000 price mark again, with the fear and greed index returning from greed to neutral sentiment. This seems to have caused some second-guessing among Bitcoin investors. However, CryptoQuant CEO Ki Young Ju is not entertaining any such thought.

According to Ki Young Ju, Bitcoin is still in the middle of a bull cycle. This is positive news for Bitcoin investors, as the crypto industry is now transitioning into a historically bullish fourth quarter of the year. 

Bitcoin Bull Market Not Over

CryptoQuant CEO Ki Young Ju is part of fervent Bitcoin investors who remain unfazed by the recent price fluctuations. However, his stance isn’t just based on speculations but is backed by technical price data and analysis. Ki Young Ju draws his bullish outlook on the Bitcoin growth rate difference, which presents an interesting outlook on the cryptocurrency. Essentially, the Bitcoin growth rate difference compares the market cap of Bitcoin to its realized cap in order to gauge its bullish or bearish strength.

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The market cap of a cryptocurrency is the total value of all coins in circulation, calculated by multiplying the current price by the total supply. In contrast, the realized cap takes into account the actual value paid for each BTC in circulation based on the price at which each coin last moved. A higher market cap growth rate suggests the spot price of the average coin has increased compared to the last it was moved.

According to a Bitcoin technical chart he shared on social media platform X, Ki Young Ju noted that Bitcoin’s market cap is still growing faster than its realized cap, which continues to point to a bull cycle. Notably, the analyst has mentioned in an earlier analysis of the growth rate difference that this trend, which started in late 2023, typically lasts for an average of two years. 

What Does This Mean For BTC?

Going by past bull cycle trends, which Ki Young Ju noted typically lasts for about two years, Bitcoin is expected to continue in a bull cycle for at least more than a year going forward. Furthermore, current fundamentals point to steady growth for Bitcoin as inflows continue to pour in from institutional investors.

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Speaking of institutional investors, Spot Bitcoin ETFs, which ended last week with the largest inflow ($494.27 million) since July 22, have begun the new week on a positive note. Particularly, they registered $61.3 million in net inflows yesterday, which is a sign of good things to come. Institutional involvement, especially through vehicles like Spot Bitcoin ETFs, is a crucial factor in BTC’s sustained price growth.

At the time of writing, Bitcoin is trading at $64,080.

Featured image created with Dall.E, chart from Tradingview.com

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