NEW YORK, June 5, 2024 - Bitcoin's price soared above $70,000 on Tuesday, fueled by substantial inflows into U.S. spot Bitcoin ETFs and weak U.S. economic data that bolstered expectations for potential Federal Reserve rate cuts. Analysts remain optimistic about the possibility of new all-time highs this week if the current trends continue.

The crypto market is abuzz with excitement as Bitcoin broke the $70,000 barrier, driven by increased risk appetite and significant ETF inflows. Analysts suggest that if weak U.S. economic indicators persist, supporting the case for two Federal Reserve rate cuts this year, Bitcoin could reach new heights in the coming days.

Rajagopal Menon, VP of WazirX, highlighted the strong buying sentiment for Bitcoin, indicating that "new highs could be on the horizon this week if economic conditions in the U.S. remain weak."

Recent U.S. economic data showed a contraction in growth, with downturns in manufacturing and construction spending despite slight job market improvements. This economic scenario is influencing the Federal Reserve's stance, with expectations of holding interest rates steady in June and July and potential cuts in September.

U.S. spot Bitcoin ETFs saw their second-largest net inflow of $887 million yesterday, led by Fidelity Wise, BlackRock, and ARK 21Shares, reflecting growing interest not only in the U.S. but also in markets like Hong Kong and Australia. Menon added that "long-term holders have ended their sell-off, with Bitcoin exchange funds seeing net inflows of $148 million last week, while Ethereum attracted $33.5 million."

The CoinSwitch Markets Desk noted sustained bullish sentiment in the market, with Bitcoin ETFs experiencing 15 consecutive days of net inflows. "BlackRock's iBit now manages over $20 billion in assets, with $2.4 billion added in the last month alone, making it the third-largest inflow in the entire ETF market," the report mentioned.

Shivam Thakral, CEO of BuyUcoin, emphasized the influence of institutional investors in pushing Bitcoin prices higher, noting that "the strong demand from institutional investors is currently driving Bitcoin prices, and favorable macroeconomic factors should help sustain the momentum in the coming weeks."

Broader Market Impact

Bitcoin's rise has had a positive ripple effect across the crypto market. Binance's native token, BNB, hit a new all-time high, gaining over 11% after news broke that former CEO CZ began his jail term in California. Telegram's TON coin also reached a new peak, with its native token NOT quadrupling in value within two weeks of its listing.

The CoinDCX Market Movement report for June 5, 2024, noted that Bitcoin touched $71,000, with ETF inflows exceeding $800 million—the highest since March 12. The report stated that "BTC needs to clear its ATH level of around $73,500 to break out and form a new all-time high. Funding rates remain neutral, which is a positive sign, although there's caution about a potential local top, similar to mid-March."

Ethereum, though slightly up, continues to lag behind Bitcoin, trading just above $3,800. Nonetheless, most altcoins are showing signs of recovery and positive momentum.