Do Bitcoin ETFs pose a risk to BTC in 2025?
- U.S. Spot Bitcoin ETFs drove a possible provide shock with surging BTC demand.
- Ethereum ETFs closed 2024 sturdy, signaling a doable shift in investor focus for 2025.
On the seventh of January, Bitcoin [BTC] as soon as once more surpassed the $100,000 milestone, peaking at $102,000 earlier than encountering a pointy bearish flip. As of the most recent update, the cryptocurrency has dropped by 6.21% prior to now 24 hours, buying and selling at $95,432.97.
This decline coincided with mounting considerations of a possible provide shock pushed by surging demand from U.S. Spot Bitcoin ETFs.
Is Bitcoin ETF posing a threat to Bitcoin?
In December 2024 alone, these ETFs bought a powerful 51,500 BTC—almost quadrupling the 13,850 BTC mined throughout the identical interval as per Blockchain.com data.
Offering additional insights on the identical, an analyst took to X and famous,
“Demand from ETFs alone was approx 272% greater than the quantity equipped.”
He added,
“They scooped 3X the almost 14,000 bitcoins mined in December.”
As anticipated, the escalating demand for U.S. Spot Bitcoin ETFs has sparked rising considerations over a looming BTC provide shock, with analysts predicting its arrival quickly.
Remarking on the identical, crypto analyst Lark Davis issued a stark warning in December, emphasizing the dimensions of BTC accumulation by these ETFs.
Davis highlighted that throughout the second week of December, ETFs acquired an astonishing 21,423 BTC, whereas miners may produce solely 3,150 BTC in the identical timeframe.
Supply: Lark Davis/X
Bitcoin ETF December developments defined
In the meantime, on the seventeenth of December 2024, international Spot Bitcoin ETFs collectively held a powerful 1,311,579 BTC, valued at $139 billion. This equated to six.24% of Bitcoin’s complete provide of 19.8 million, highlighting their important market affect.
Davis predicted that in peak bull market cycles, these ETFs may amass 10-20% of Bitcoin’s complete provide, additional amplifying fears of a serious provide shock.
Supporting this concern, information from Glassnode exhibits that Spot Bitcoin ETFs witnessed a staggering $4.63 billion in web inflows for December, almost doubling the 2024 month-to-month common of $2.77 billion.
Curiously, this inflow was concentrated within the first half of the month, with the second half seeing outflows—apart from a notable spike on twenty sixth December.
Can Ethereum ETF surpass Bitcoin ETF in 2025?
As of seventh January, Bitcoin ETFs recorded $52.4 million in inflows, a big drop from the $978.6 million noticed the day past. In the meantime, Ethereum [ETH] ETFs reported outflows totaling $86.8 million on the identical date, in keeping with Farside Investors.
Regardless of this, Ethereum ETFs have showcased spectacular resilience, closing 2024 with $35 billion in complete inflows. Due to this fact, analysts counsel this displays rising confidence in Ethereum’s long-term worth proposition.
With Bitcoin ETFs persevering with to dominate when it comes to market exercise, Ethereum ETFs are steadily narrowing the hole.
Ergo, if these developments persist, 2025 may mark a pivotal shift in investor focus, doubtlessly positioning Ethereum ETFs as front-runners within the crypto funding panorama.
