Key Points
- U.S. Spot Bitcoin ETFs have driven a potential supply shock due to surging BTC demand.
- Ethereum ETFs ended 2024 strongly, indicating a potential shift in investor focus for 2025.
On January 7, Bitcoin (BTC) once again crossed the $100,000 mark, reaching a peak of $102,000 before experiencing a sharp bearish turn.
As per the latest update, the cryptocurrency has fallen by 6.21% in the past 24 hours, currently trading at $95,432.97.
Bitcoin ETF and Potential Supply Shock
This decrease is in line with increasing worries about a possible supply shock caused by soaring demand from U.S. Spot Bitcoin ETFs.
In December 2024, these ETFs bought an impressive 51,500 BTC, almost four times the 13,850 BTC mined during the same period.
An analyst commented on this, noting that demand from ETFs alone was approximately 272% more than the amount supplied.
The growing demand for U.S. Spot Bitcoin ETFs has led to increasing concerns about an impending BTC supply shock, which analysts predict will happen soon.
Crypto analyst Lark Davis issued a stark warning in December, emphasizing the scale of BTC accumulation by these ETFs.
Davis pointed out that during the second week of December, ETFs acquired an astonishing 21,423 BTC, while miners could only produce 3,150 BTC during the same period.
Trends in Bitcoin ETF in December
On December 17, 2024, global Spot Bitcoin ETFs collectively held an impressive 1,311,579 BTC, valued at $139 billion.
This represented 6.24% of Bitcoin’s total supply of 19.8 million, underlining their significant market influence.
Davis predicted that during peak bull market cycles, these ETFs could hold 10-20% of Bitcoin’s total supply, further fuelling fears of a major supply shock.
Supporting this concern, data from Glassnode shows that Spot Bitcoin ETFs saw a staggering $4.63 billion in net inflows for December, almost doubling the 2024 monthly average of $2.77 billion.
Ethereum ETFs Gaining Ground
On January 7, Bitcoin ETFs reported $52.4 million in inflows, a significant decrease from the $978.6 million seen the previous day.
Meanwhile, Ethereum (ETH) ETFs reported outflows totaling $86.8 million on the same date.
Despite this, Ethereum ETFs have demonstrated remarkable resilience, ending 2024 with $35 billion in total inflows.
Analysts suggest this reflects growing confidence in Ethereum’s long-term value proposition.
While Bitcoin ETFs continue to lead in terms of market activity, Ethereum ETFs are steadily closing the gap.
If these trends continue, 2025 could witness a significant shift in investor focus, potentially positioning Ethereum ETFs as leaders in the crypto investment landscape.
