Key Points
- Bitcoin ETF inflows have decreased significantly since the start of the week.
- The liquidity inventory ratio has increased, indicating that supply could meet demand for an extended period.
Bitcoin’s [BTC] price has been relatively stable over the past ten days, fluctuating between $61,000 and $65,000, according to CoinMarketCap data.
The recent halving event did not significantly impact its price trajectory.
Decreasing Inflows to U.S. Spot ETFs
Julio Moreno, Head of Research at CryptoQuant, suggests that the lack of price movement is partly due to reduced inflows to U.S. spot ETFs.
As of April 25th, net outflows of $217 million were reported, and nearly $147 million has been lost since the week started.
Since their launch in early 2021, these investment vehicles have been a key factor in Bitcoin’s price movements.
When net positive days occur, prices tend to rise and vice versa.
Liquidity Inventory Ratio Rises
The drop in demand is also reflected in the significant decrease in accumulation addresses since late March.
Accumulation addresses are those that have a history of only buying BTC but no history of selling.
ETFs, which use BTCs to back their shares, fall under this category.
As a result, the liquidity inventory ratio, which assesses the sell-side liquidity of the asset against its demand, has risen sharply from 15 months in late March to 24 months currently.
This implies that the available BTC supply could last longer given the reduced demand.
Shivam Thakral, CEO of Indian cryptocurrency exchange BuyUcoin, anticipates that the upcoming listing of Hong Kong’s spot ETFs might stimulate demand for Bitcoin.
He stated, “After the Hong Kong ETF launch, we can expect a similar price momentum to that of January for Bitcoin, which could potentially push the largest crypto to a new ATH in the upcoming months.”
