The bitcoin price, which has staged a miraculous recovery from its 2022 price crash, has ridden a Wall Street exchange-traded fund (ETF) push into bitcoin—that’s seen the likes of BlackRock and Fidelity hoover up huge amounts of bitcoin alongside a looming supply shock.
Now, as Russia’s president Vladimir Putin stokes fresh fears over the U.S. dollar’s $34 trillion problem, bitcoin “fomo” [fear of missing out] has been predicted to soon hit Wall Street.
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“Wall Street doesn’t just like bitcoin, they love bitcoin,” Anthony Pompliano, a bitcoin and crypto investor who writes the popular The Pomp Letter investing advice newsletter on Substack, told CNBC in a video titled: “Bitcoin fomo has hit Wall Street.”
Pompliano pointed to BlackRock and Fidelity, which manage the two largest of a fleet of newly approved U.S. spot bitcoin ETFs, each buying over $3 billion worth of bitcoin in their first few weeks of trading. Combined, the new bitcoin ETFs have accumulated just over 200,000 bitcoin worth almost $10 billion, according to K33 Research.
“Bitcoin’s winning streak since the start of the year shows that increased mainstream demand, especially from bitcoin ETFs, will continue to drive strong upward price momentum,” Alex Adelman, the chief executive of bitcoin rewards app Lolli, said in emailed comments.
“The biggest financial firms in the world are now actively buying bitcoin to cover record-breaking inflows for bitcoin ETFs, providing new sustained tailwinds for bitcoin. Bitcoin ETFs have seen historical success in just one month of trading. As more leading institutions launch bitcoin ETFs and other bitcoin-based financial products, the resulting upward price moves will also drive more direct investments in bitcoin from mainstream investors.”
Other analysts have also predicted institutional investment from Wall Street will drive the bitcoin price higher this year.
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“The institutional narrative led by bitcoin ETFs is driving demand, and bitcoin being the reflexive asset, we expect higher price will bring higher ETF inflows, leading to new highs in 2024,” analysts at the brokerage Bernstein, Gautam Chhugani and Mahika Sapra, wrote in a note to clients seen by Coindesk.
“Consistent net ETF inflows means the overall market will lean bullish and reflexivity should ensure a higher price-higher inflows feedback loop.”
Meanwhile, bitcoin and crypto watchers are looking toward bitcoin’s next supply cut, known as a halving, that will see the number of new bitcoin issued to so-called miners, who secure the network in return for newly minted bitcoin, reduced by half in in April.
“There are only 21 million bitcoin that will ever exist; bitcoin’s fixed supply means surging demand will keep driving its price up,” Adelman added.
“The year promises even more growth for bitcoin. Bitcoin is on the cusp of its next halving, which historically brings significant price increases. These factors combined suggest that bitcoin is on track for a record-breaking year and new all-time highs.”