Inflows to ETFs are not decreasing. BTC price hits USD 71000

Almost two months have passed since the launch of Bitcoin ETFs, where, after turbulent first days, the cryptocurrency price moved north. Today, the price of bitcoin exceeded USD 71000, and total inflows to ETFs have already amounted to almost USD 10 billion net. The largest inflow is still observed in BlackRock's IBIT fund, which amounted to over USD 6 billion, and perhaps these products will be joined by others in Great Britain.

Today, the London Stock Exchange LSE confirmed that in the second quarter of 2024 it will accept applications for the acceptance of ETN products for bitcoin and for Ethereum. This may be another step towards the entry of investors from the world of traditional finance into the cryptocurrency market. Meanwhile, the SEC will also decide in May what to do with ETH ETFs.

Bitcoin price a month before halving

Designation of a new peak by Bitcoin before halving is a phenomenon we have not seen before. Halving should take place in mid-April. Therefore, it can be noticed that the existing dependencies have been broken, which raises a new question as to whether we are currently observing a front running before the halving, as the saying goes: "buy rumors, sell facts"?

What is a Bitcoin halving?

Halving in the context of bitcoin is an event that reduces the reward given to miners for mining a new block by half. This happens every 210 blocks, which roughly corresponds to a period of four years. This process was designed by Bitcoin's creator, Satoshi Nakamoto, as a way to control inflation and simulate the scarcity of the digital currency.

The initial reward for mining one block was 50 BTC. After the first halving in 2012, this reward was reduced to 25 BTC, then to 12,5 BTC in 2016 and to 6,25 BTC in 2020. The next halving event in April 2024 will be when the reward will be reduced again, this time to 3,125 BTC.

Halving has a significant impact on the economics of Bitcoin because it affects supply by reducing the number of newly generated coins. Theoretically, if demand for bitcoin remains unchanged or increases, a reduction in supply could lead to an increase in price.