NEW YORK, February 29, 2024 — Bitcoin’s recent surge toward its all-time highs has sparked a dramatic uptick in investor interest, leading to a record-breaking influx of capital into exchange-traded funds (ETFs) tracking the cryptocurrency. On Tuesday, BlackRock’s iShares Bitcoin Trust (IBIT) experienced an extraordinary single-day inflow of $520 million, marking the largest daily influx for any ETF focused on bitcoin and positioning it as the second-largest daily cash infusion for a U.S. ETF overall, according to Bloomberg data.

The substantial capital inflow into BlackRock’s bitcoin ETF coincides with bitcoin’s renewed ascent toward its historic peak of $69,000. On Thursday, bitcoin traded around $63,000, reflecting a 5% increase within the day. This renewed rally has ignited considerable enthusiasm among investors, spurring them to seek exposure through ETFs that offer an indirect investment route into the cryptocurrency market.

The surge in IBIT’s inflows follows the approval of nearly a dozen spot bitcoin ETFs in early January, which were hailed as a breakthrough for investors seeking a more accessible method to gain exposure to bitcoin without having to directly purchase the asset. Since its launch, BlackRock’s ETF has seen an impressive streak of 32 consecutive days of inflows, underscoring its growing appeal in the market.

Market analysts attribute the current rally and the associated influx into bitcoin ETFs to a surge in retail trading activity, reflecting a broader appetite for cryptocurrency investments. This strong demand from retail investors is seen as a key driver behind the rising price of bitcoin and the overall bullish sentiment in the crypto market.

Additionally, this month’s rally is fueled by the anticipation of bitcoin’s upcoming halving event, scheduled for April. During this event, the reward for mining new bitcoins will be reduced by half, from 6.25 BTC to 3.125 BTC. Historically, halving events have contributed to significant price increases as they enhance bitcoin's scarcity, reinforcing the long-term bullish outlook as the cryptocurrency approaches its capped supply of 21 million coins. This scarcity narrative is central to the cryptocurrency’s value proposition and has been a driving force behind its recent price movements and investor interest.