Bitcoin (BTC) ended the week at approximately $68,400, showing a slight 0.8% decrease from the previous week’s closing value of around $69,000. Throughout the week, BTC displayed significant volatility, with a price range of 13.4%. The week commenced with robust momentum as BTC surged to $72,000 on Monday. Subsequently, the price reached a new all-time high of nearly $73,800 on Thursday, following peaks of over $73,000 on both Wednesday and Thursday.

On the same Thursday, BTC experienced a sharp decline to $68,000 before rebounding to close around $71,400. On Friday and Saturday, selling pressure persisted, driving BTC to trade as low as $64,700 and closing Saturday near $65,300. However, positive momentum returned on Sunday, nearly recovering the weekly loss and closing around $68,400.

Despite the volatility and fluctuating prices, the previous week demonstrated continued strong momentum for BTC Spot ETFs, with net inflows recorded on all trading days. The weekly net inflow surpassed $2.5 billion, with Tuesday alone witnessing a net inflow of over $1 billion. The cumulative net inflow since inception now stands at approximately $12.2 billion.

Trading volume for BTC Spot ETFs also witnessed an upward trend, with total trading volume reaching $141.7 billion since inception, including nearly $28 billion traded in the last week. This translated to a daily trading volume exceeding $5.5 billion during the previous week, contributing to a higher average daily volume since inception, currently standing at approximately $3.15 billion.

These figures underscore the sustained momentum of investments from traditional finance into the digital assets space. Despite BTC’s price stability last week, the demand primarily stems from ETFs, while native digital assets investors are more active on the selling side.

This trend is evident in the decrease of BTC held by long-term holders, referring to BTC that remained unmoved for at least 155 days. At the beginning of 2024, this supply was nearly 16.3 million BTC, gradually decreasing to about 15.1 million BTC as now. This shift reflects traditional investors driving buying activity through ETFs, while native digital assets investors, who accumulated during the downtrend in 2022 and 2023, are now profit-taking at a higher rate, reducing long-term holder supply.

Such behaviour is characteristic of early bull phases, where long-term holders distribute assets to new investors. If the current market remains in an uptrend, analysing the past cycles, this pattern could persist until the supply from long-term holders matches the demand from new investors, which usually coincides with the cycle’s peak and the beginning of a downtrend phase.

Notably, the BTC halving is approximately one month away, historically preceding cycle peaks between 6 and 12 months later. If historical patterns repeat, the current cycle’s peak could occur in late 2024 or the first half of 2025.

Bitcoin (BTC) wrapped up the week at approximately $63,100, marking a notable 22% surge from the previous week’s closing price of around $51,725. The week witnessed vigorous price action, particularly in the first half, as BTC experienced a substantial appreciation from Monday to Wednesday, peaking at $64,000 on Wednesday. Subsequently, the price stabilized in the latter half of the week, closing at about $63,100. As of the time of this writing, BTC has regained momentum and is currently trading above $65,000.

The BTC Spot ETFs continue to exhibit strong momentum, with a cumulative net inflow of approximately $1.7 billion recorded last week, bringing the total net inflow since inception to about $7.4 billion. Leading the race is the Blackrock Bitcoin ETF (IBIT), which surpassed $10 billion in assets under management (AUM) last week, setting a record as the fastest ETF in history to achieve this AUM milestone.

Trading volumes for BTC Spot ETFs saw a significant surge during the week, totalling $22.3 billion, with an average daily trading volume of almost $4.5 billion. This marked a remarkable 265% increase from the average daily trading volume of $1.7 billion recorded since inception. The cumulative trading volume now exceeds $73.9 billion, with the daily average volume surpassing $2 billion, currently standing at $2.1 billion.

Similarly, trading volume surged on centralized digital assets exchanges, reaching a cumulative trading volume of $73.4 billion for the week. This represents an 80% increase from the previous week’s volume of $40.7 billion and marks the highest weekly trading volume recorded since May 2022. The data underscores the recent price appreciation accompanied by robust trading activity.

The rise in open interest, which represents the total number of outstanding derivative contracts for an asset that have not been settled, is observed both for BTC and the digital assets market in general, across both centralized digital assets exchanges (e.g., Binance, Coinbase, ByBit, etc.) and traditional finance investors’ platforms (e.g., CME). This indicates heightened activity from both digital assets native and traditional finance investors.

The strong momentum extends beyond Bitcoin to the overall market, with the total digital assets market cap currently standing at $2.5 trillion, approaching the all-time high of $3 trillion. Notably, the Total3 metric, which excludes Bitcoin (BTC) and Ethereum (ETH) and represents the market cap of the top 125 capitalised digital assets, has surged to $660 billion, reflecting a 19.3% growth week-on-week and a 31.5% year-to-date increase. This underscores the broad impact of BTC Spot ETFs on market momentum beyond BTC’s price action.

Examining the total stablecoin supply also provides insights into heightened demand. During periods of low demand, the supply of stablecoins typically decreases as investors exchange them for fiat currencies like USD, GBP, or EUR, thereby reducing the overall circulating supply. Conversely, during phases of increased liquidity injection into the market, the supply of stablecoins tends to expand. Presently, the total stablecoin supply stands at approximately $145 billion, reflecting a continuous uptrend from around $129 billion noted at the end of September 2023. This confirms sustained strong investor demand observed throughout Q4 2023 and into Q1 2024.

Bitcoin (BTC) concluded the week at approximately $51,725, indicating a slight 0.8% decline from the prior week’s closing price of about $52,150. The week was characterized by relatively low volatility, with prices maintaining stability between approximately $53,000 and $50,500, marking a range of around 4.7%. The peak trading value of $52,985 was recorded on Tuesday.

The focus remains on BTC Spot ETFs, which continue to demonstrate robust momentum. However, a net outflow was observed for the first-time last week on Wednesday, the 21st, following 17 consecutive days of inflows. Despite this, approximately $585 million in inflows were recorded for BTC Spot ETFs throughout the week, indicating continued investor interest.

The total net inflow since the ETFs’ launch now stands at approximately $5.6 billion.Trading volumes remained elevated, with cumulative trading volume surpassing $50 billion since launch and currently standing at $51.6 billion, with an average daily volume of about $1.7 billion. Last week’s cumulative volume reached about $6.3 billion, with a daily average volume of $1.6 billion, as there were only four days of trading.

The increased institutional presence in the market following the approval of BTC Spot ETFs is evident in the average BTC trading size on centralized exchanges. Since the launch week, the average trading size has significantly increased, consistently exceeding $1,000 per transaction. Notably, transactions on Coinbase saw a more pronounced increase compared to other exchanges, reflecting Coinbase’s popularity among institutional investors and its role as the custodian for most recently launched BTC Spot ETFs.

The ETFs’ launch also contributed to enhanced market liquidity. Analysis of the 2% market depth, which measures aggregated bids and asks on BTC order books within a 2% spread from the price, reveals a 23% increase in liquidity since November 2023 and a 30% year-on-year rise. This suggests heightened activity and participation from market makers, signaling a notable uptick for the first time following the collapse of FTX. The FTX insolvency event resulted in the bankruptcy of Alameda, a major liquidity provider in the digital assets market at the time.

Increased liquidity and demand are further evidenced by the total supply of stablecoins. After a continuous decline for about 18 months from May 2022 to October 2023, the total supply of stablecoins began to rise again from November 2023, reaching nearly $139 billion from an initial level of about $124 billion. This 12% increase in total supply indicates growing demand and liquidity in the market.

Overall, the market is exhibiting strong resilience across various aspects. BTC maintains a price above $50,000, altcoins like ETH perform well with a price exceeding $3,000, and liquidity increases alongside high demand, as seen through inflows into BTC Spot ETFs and the surge in stablecoin supply. Additionally, with the BTC halving approaching in less than two months, the market anticipates another significant event that could impact market trends.