Bitcoin’s total investment surpassed $1 trillion on Wednesday, marking the first time since November 2021, fueled by inflows to U.S. spot bitcoin exchange-traded funds (ETFs) which continue to bolster prices.
On Wednesday, Bitcoin’s price soared to $51,606, hitting its latest 25-month peak with a 4.1% surge, driving its market cap to $1.005 trillion according to Coingecko.
Coingecko data indicates that Bitcoin’s all-time high market cap was $1.28 trillion in November 2021.
Bitcoin has seen a roughly 20% surge since the start of February, poised for its most significant monthly gain since October.
Investments in Bitcoin now constitute over half of the $2.01 trillion total parked in the cryptocurrency market, encompassing Ethereum and other digital assets.
Analysts attribute recent price actions partly to robust inflows into new U.S.-listed ETFs, with capital flows into 11 U.S. spot bitcoin ETFs reaching $1.64 billion in the week up to Wednesday, as per LSEG Lipper data.
Over the last five trading sessions, these ETFs garnered $409 million in inflows since gaining regulatory approval and commencing trading in January.
“In the crypto world, price often dictates flow,” remarked analysts at crypto liquidity provider B2C2, speculating that sustained momentum like the past few days could see substantial inflows leading to further price hikes for spot bitcoin.
Ahead of Wednesday’s trading, U.S.-listed cryptocurrency companies witnessed a surge, with Coinbase climbing 7%, while miners Riot Platforms and CleanSpark saw gains of nearly 9% and 16%, respectively.
Bitcoin reached an all-time high of $69,000 in November 2021 but struggled through much of 2022 and early 2023 due to global central banks’ monetary tightening and notable failures at crypto companies, including leading exchange FTX.
However, recent months have seen optimism around a smooth economic transition and the introduction of spot bitcoin ETFs, which have been lauded as a game-changer for the industry. These ETFs offer exposure to bitcoin without the need to directly hold the asset, catering to both retail and institutional investors.
Meanwhile, Ethereum, the second-largest token supporting the Ethereum network, surged 4.1% to $2,742, its highest level since May 2022.
