Bitcoin Hovers Around $57K Amid Spot ETF Inflows

Bitcoin’s (BTC) price is holding steady around $57,000 Tuesday, perhaps as robust spot bitcoin exchange-traded funds’ (ETFs’) inflows offset price weakness from large investors selling the crypto asset.

Despite more record highs for the S&P 500 and Nasdaq on Monday, bitcoin is a long way from the all-time high it set in March, although it has gained about 6.5% from last week’s low.

Spot Bitcoin ETF Inflows Steady Price Weakness

Spot bitcoin ETFs posted net inflows of almost $295 million Monday. That may not seem like a large amount but it’s significant because that’s more than the combined net inflows for these products over the last two weeks, according to data from Farside Investors.

BlackRock’s iShares Bitcoin Trust (IBIT) was the biggest gainer on flows Monday, netting $187 million, followed by Fidelity’s Fidelity Wise Origin Bitcoin Fund (FBTC), which received about $62 million in inflows.

Inflows into the new spot bitcoin ETFs have been credited with creating a demand for bitcoin since they first began trading in January, which in turn fueled a massive rally in bitcoin prices to all-time highs of more than $73,000 in March.

Similarly, Monday’s inflows may have helped offset some of the price weakness in bitcoin attributed to selling pressures from large investors.

Germany Continues To Sell Bitcoin

Germany has continued selling bitcoin that was previously seized from an online piracy website. According to Arkham Intelligence, the European Union member sent $362.12 million worth of bitcoin to various exchanges and brokers during a three-hour period on Tuesday, including $184.58 million sent within a 20-minute window.

That said, it should be remembered that not all blockchain-based transfers by the German government’s bitcoin addresses are necessarily sales, as these are simply transfers to various crypto off-ramps.

In fact, the German government has received bitcoin back from multiple exchanges over the past 24 hours. That’s likely because the bitcoin couldn’t be sold at prices desired by that government,The Block reported Monday. Germany still has roughly $1.31 billion worth of bitcoin left to sell, according to Arkham Intelligence.

Bitcoin Investors Looking at Powell, Fed

Bitcoin and other market analysts will be watching Federal Reserve Chairman Jerome Powell’s testimony during the Semiannual Monetary Policy Report to the Congress on Tuesday and Wednesday, as some are hoping for signs that interest rates could be lowered before the end of the year, which could be a boon for all markets.

Higher rates have pushed up Treasury yields, making them more attractive than riskier investments such as cryptocurrencies. That could change, once the Fed lowers its benchmark rate and interest rates begin falling.

Currently, the CME FedWatch tool indicates that markets almost unanimously expect rates to remain the same for the Fed meeting coming up later this month; however, there is about a 73% chance for a rate cut forecast for September.