- BlackRock’s iBIT ETF surpasses $2 billion in assets, signalling strong institutional demand for Bitcoin.
- GBTC outflows continue but at a reduced pace, potentially indicating a shift in investor sentiment.
- Bitcoin price remains near $42,000 despite headwinds, suggesting cautious optimism ahead of the FOMC meeting.
- FOMC’s decision and Chair Powell’s statements hold the potential to significantly impact risk assets, including Bitcoin.
Bitcoin started the week cautiously optimistic, buoyed by strong inflows into spot ETFs and sustained price action despite fresh outflows from the Grayscale Bitcoin Trust (GBTC). The cryptocurrency market entered a pivotal week, awaiting the Federal Open Market Committee (FOMC) meeting and its potential impact on risk assets.
While GBTC witnessed further outflows, totalling $360 million on Monday, spot ETFs experienced a promising influx of $759 million. BlackRock’s iShares Bitcoin Trust (iBIT) ETF emerged as a major driver, surpassing $2 billion in assets under management with over 52,000 BTC held. This implied buy volume, exceeding Bitcoin’s daily emission rate, sparked optimism on social media, suggesting institutional demand is outpacing new supply.
Market participants adopted a cautious stance ahead of the FOMC meeting on January 31, a potential catalyst for volatility across risk assets. While a 97% chance of an interest rate hold is currently priced in, anticipation for potential rate cuts in March lingers. Analysts expect the FOMC meeting to set the stage for future monetary policy decisions and Chair Jerome Powell’s press conference to be closely watched for market-moving announcements.