The cryptocurrency world saw an impressive moment on 6 November, as the BlackRock Bitcoin ETF, officially called the iShares Bitcoin Trust (IBIT), reached a trading volume of over $4.1 billion in a single day.
This was the day after Donald Trump was re-elected as US President, a development that has brought renewed optimism to the crypto market.
The BlackRock Bitcoin ETF’s trading volume outpaced stocks like Berkshire Hathaway, Netflix, and Visa.
According to Eric Balchunas, an ETF analyst at Bloomberg, this was IBIT’s second-highest trading day since it was introduced.
The ETF’s price also surged by 10% on the same day, reflecting the high demand among investors.
Crypto analyst, Rachael Lucas, explained this rise as a combination of factors. She cited three main drivers: the growing trust that large institutions have in Bitcoin, a “fear of missing out” (FOMO) on the recent price gains, and delayed capital flows.
“This mix of institutional trust, FOMO, and delayed flows led to this massive volume in trading”, Lucas noted.
The re-election of Donald Trump, who has voiced support for cryptocurrency, added fuel to Bitcoin’s recent upward momentum.
Another factor pushing investors toward Bitcoin is the recent interest rate cut by the Federal Reserve, making it cheaper to borrow money and making Bitcoin appear as a safer alternative.
Bitcoin ETFs see a wave of inflows
The BlackRock Bitcoin ETF’s popularity seems to have influenced other Bitcoin-related funds. In fact, 6 November marked a historic high in net inflows for US-based Bitcoin ETFs, with a total of $1.38 billion invested across 12 funds.
Other major funds, such as Fidelity’s FBTC, Grayscale’s Mini Trust, and products from Ark, 21Shares, and Bitwise, also saw a rise in trading volume, some nearly double their average daily volume.
A leading crypto data provider, SoSo Value, reported that Bitcoin ETFs saw $621.90 million in net inflows that day, a significant increase from the daily average of the previous three days.
BlackRock’s ETF led this influx, attracting $1.11 billion from investors, based on data from Farside Investors. Bitwise’s Bitcoin ETF, another major player, also gained attention, with inflows of $190 million.
The Chief Investment Officer at Bitwise, Matt Hougan, expressed optimism about how a pro-crypto regulatory environment under Trump could benefit the market.
“A pro-crypto regulatory environment will provide air cover for institutional investors who have long wanted to allocate to the space. It’s a game-changer”, Hougan said on social media platform X.
New all-time high for Bitcoin
Trump’s re-election wasn’t the only factor driving excitement in the crypto market. Bitcoin itself reached a new all-time high, surging to $76,600 just after Trump’s victory.
This was a milestone for Bitcoin, driven by a wave of investor interest and the Federal Reserve’s recent interest rate cut by 25 basis points.
Many analysts now predict that Bitcoin could hit new heights in the coming months. Some forecasts suggest a price target of $100,000, while the Pi Cycle Top indicator—a tool used to predict market peaks—offers an even more ambitious projection, indicating that Bitcoin could reach as high as $117,496.
Bitcoin has been a standout performer in the ETF world in 2024, with six of the top 10 ETF launches linked to Bitcoin.
The President of ETF Store, Nate Geraci, commented on Bitcoin’s consistent demand in the market, saying, “The demand for exposure to Bitcoin is ongoing”.
Industry experts also expect the new developments in the US to pave the way for new cryptocurrency funds, including ETFs for other cryptocurrencies like Solana, XRP, and Litecoin.
In October, Bloomberg analyst Eric Balchunas noted that recent filings for crypto ETFs could be seen as “call options on a Trump victory”. This means that if Trump won, it would likely create a more favourable regulatory environment for these funds.
