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Bitcoin’s rally just got institutional backing. US spot Bitcoin ETFs pulled in $730.9 million on Thursday, their largest single-day haul since mid-January, as the price pushed back above $80,000 after a choppy week of trading. But not everyone is convinced the move has real staying power.
The inflow surge, first reported by SoSoValue, followed a smaller $101.2 million day on Wednesday and came as Bitcoin climbed out of a tight range between roughly $76,000 and $81,000. While the headline numbers look bullish, at least one major analytics firm is urging caution about what’s actually driving the price action.
BlackRock Leads a Broad-Based Buying Wave
BlackRock’s iShares Bitcoin Trust dominated Thursday’s inflows, pulling in $454 million — nearly two-thirds of the day’s total, according to Farside Investors data. That’s a massive number, though it’s actually smaller than the $503 million IBIT drew on its own just two weeks earlier, a reminder that even record days sit within a volatile range.
ARK Invest and 21Shares’ joint Bitcoin ETF brought in another $137.7 million, while Fidelity’s fund added $74.4 million. Not every issuer benefited, though — VanEck and WisdomTree’s funds both saw modest outflows, showing the rally wasn’t universally embraced across every product on the market.
Why Some Analysts Are Still Skeptical
Despite the strong ETF numbers, CryptoQuant flagged a warning sign: much of Bitcoin’s recent bounce appears to be driven by traders closing out short positions rather than new buyers stepping in. The firm noted that holders locked in 23,000 BTC in profits in a single day in late August, the largest such move all year, with roughly 110,000 BTC in total profit-taking over just a few days — a sign of heavy selling into strength even as prices climbed.
CryptoQuant is watching $83,000 as the level that matters most — it roughly lines up with Bitcoin’s 365-day moving average, a line the firm says has historically separated bull and bear markets. Bitcoin touched $81,400 in late August before slipping back under that threshold. A confirmed close above $83,000 would validate the new bull market, CryptoQuant said, while a rejection could trigger a slide back toward $69,000, near the 200-day moving average.
Also Read: Charles Schwab Adds 3 Major Cryptos: Solana, Avalanche and Chainlink Next
Broader Market Riding the Same Wave
The rally wasn’t isolated to Bitcoin. The total crypto market cap jumped to nearly $2.82 trillion, its highest level in over seven months and a sharp recovery from the roughly $2.3 trillion low hit in early February after January’s sell-off. Zcash led gains among top cryptocurrencies with a 16.5% jump, while Cardano, Dogecoin and XRP each climbed double digits.
Crypto-linked stocks followed suit. Strategy and Circle both gained around 15%, Coinbase rose roughly 10%, and Strategy’s STRC preferred shares climbed back near their $100 par value after falling as low as $69 just five weeks earlier. Wincent’s Paul Howard credited the move to ETF inflows and OTC activity breaking Bitcoin through the $80,000 level, adding that renewed memecoin trading activity could help support a steady climb toward $100,000 by year-end.
What’s Driving the Bigger Picture
Some analysts see Bitcoin’s rise as part of a broader “debasement trade” tied to government debt concerns. RootstockLabs’ Richard Green said Bitcoin’s move alongside gold reflects investors rotating into hard assets as fiscal conditions worsen, though he cautioned further pullbacks remain likely.
Options positioning suggests traders are hedging rather than making all-in bets. Tesseract Group’s Adam Haeems pointed to roughly $1.4 billion in September Bitcoin puts clustered between $68,000 and $75,000, alongside heavier call positioning between $82,000 and $100,000 — a setup he described as a “hedged long,” where investors stay exposed to upside while insuring against a drop.
Markets now turn to the Fed’s September 16 meeting, where traders are almost evenly split between a rate cut and holding steady — a decision likely to determine whether this rally has room to run.
Disclaimer: The information in this article is for general purposes only and does not constitute financial advice. The author’s views are personal and may not reflect the views of Chain Affairs. Before making any investment decisions, you should always conduct your own research. Chain Affairs is not responsible for any financial losses.
I’m your translator between the financial Old World and the new frontier of crypto. After a career demystifying economics and markets, I enjoy elucidating crypto – from investment risks to earth-shaking potential. Let’s explore!
