[NEWS] Bitcoin surges to $56,500 as demand for physical ETFs rises

Bitcoin (BTC) temporarily soared to $56,500 (approximately JPY 8.5 million) on the 27th, up about 10% from the previous day. When calculated in Japanese yen, this represents a significant increase from the previous record.

Recently, funds have flowed into altcoins, mainly Ethereum (ETH), but the inflow into Bitcoin is becoming more pronounced again.

The background to this is the successive purchases of Bitcoin spot ETFs by institutional investors. The trading volume of iShares Bitcoin Trust (IBIT), offered by major asset management company BlackRock, reached a record high of approximately $1.3 billion (approximately JPY 195 billion) on the 26th. This is a new record for the volume recorded on the first day of trading.

In addition, the total trading volume of Bitcoin spot ETFs other than BlackRock also exceeded the first day's volume and reached a record high, indicating that institutional investors are rapidly increasing their interest.

In light of this situation, Eric Balchunas of Bloomberg mentioned on X (formerly Twitter) that "there is a good chance that Bitcoin spot ETFs will overtake gold ETFs within two years."

Positive stock market conditions also support

Currently, following favorable earnings reports from semiconductor giant NVIDIA, capital is flowing into risk assets one after another.

In addition, a wide range of investors, from individual investors to institutional investors, are investing in this situation, with the NY Dow in the United States and the Nikkei average in Japan reaching record highs surpassing those during the bubble period. The start of interest rate cuts in the United States, which is attracting attention, is expected to be delayed from March, but the view that they may begin in June is also supporting this.

On the other hand, there are also indications that interest rate cuts may not be implemented until the presidential election in November. According to the minutes of last month's FOMC (Federal Open Market Committee) meeting released the other day, participants were reluctant to start interest rate cuts early, and the outlook for the actual timing of the cuts, along with the US presidential election, is unclear.

Reference:Balchunas X
Image: Shutterstock

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