Bitcoin nears $69K mark amid strong ETF inflows and short liquidations

Bitcoin’s rise towards a two-month high of $69,000 was driven by strong inflows into spot exchange-traded funds and a marked increase in short liquidity.

At the time of writing, Bitcoin (BTC) was trading at approximately $67,739, up 0.6% in the last 24 hours. The market value of the asset was hovering around $1.33 trillion, thanks to a daily trading volume of close to $30 billion.

Short liquidations are on the rise, fueling price growth

Data from Coinglass shows that short liquidations played a critical role in Bitcoin’s recent upward move. In the last 24 hours, Bitcoin’s short liquidations reached $17.91 million and exceeded $11.8 million in long liquidations. This shift highlights a typical market dynamic in which forced closings of short positions increase demand, pushing the Bitcoin price upwards and creating additional buying pressure.

In addition to market-driven liquidations, inflows into US-based spot Bitcoin ETFs have also reached significant levels. Last week, these ETFs reported five consecutive days of total net inflows of more than $2.12 billion. This trend continued at the beginning of this week with new inflows of $294.29 million.

On October 24, data from SoSoValue showed that spot Bitcoin ETFs generated net inflows of $188.11 million. Leading this influx, BlackRock’s IBIT ETF recorded an inflow of $165.54 million. This marks the ninth consecutive day of inflows into BlackRock’s ETF, with the fund raising nearly $2 billion in that period alone.

Meanwhile, Bitwise’s BITB ETF generated an inflow of $29.63 million despite experiencing an outflow of $25.2 million the previous day. However, Grayscale’s GBTC ETF responded to this momentum with an outflow of $7.05 million, continuing the trend of over $20 billion outflows from the fund since its inception.

Since the launch of the first spot Bitcoin ETFs in January, the 12 products currently available have accumulated net inflows of $21.53 billion; It’s a milestone that Bloomberg ETF analyst Eric Balchunas described as the “most difficult metric” to achieve in the ETF landscape.

Balchunas emphasized that this success is rare, stating that it took five years for gold ETFs to reach the same figure, and underlined the rapidly growing appetite for Bitcoin investment among institutions.

Political headwinds and potential policy changes

Beyond immediate market activity, the political landscape in the United States also affects investor sentiment.

Speculation surrounding a possible win for Donald Trump in the upcoming presidential election has increased optimism among Bitcoin investors, who see a pro-crypto administration as likely to boost blockchain innovation and reduce regulatory hurdles.

The former president’s policy stance, which includes advocating for a blockchain-friendly regulatory environment and potentially replacing SEC Chairman Gary Gensler, aligns with the interests of many institutional investors in reducing regulatory oversight.

The potential shift provided an additional boost to Bitcoin’s price momentum as it could pave the way for a harmonious regulatory environment conducive to the cryptocurrency’s growth.