U.S.-listed spot Bitcoin exchange-traded funds (ETFs) opened October with a strong rally, pulling in $3.24 billion in inflows during the week.
This is the second-best week since the ETFs were first launched, only slightly behind the record $3.38 billion set in late November 2024, according to data from SoSoValue.
The turnaround was especially sharp compared with the prior week’s $902 million in outflows, which had weighed heavily on sentiment.
This reason for this shift is due to the renewed optimism around risk assets, especially since many investors believe the U.S. Federal Reserve may cut interest rates again soon, which usually makes very risky assets like Bitcoin more attractive.
Iliya Kalchev, an analyst at the digital asset platform Nexo explained how investor mood had changed in a recent statement.
“Growing expectations of another US interest rate cut triggered a shift in sentiment, attracting renewed investor demand for Bitcoin ETFs, bringing four-week inflows to nearly $4 billion,” Kalchev said. He added that, at current rates, ETF flows in the fourth quarter could pull over 100,000 BTC from circulation, which is more than double the new supply coming into the market.
Kalchev also pointed out that demand from ETFs is rising while long-term holders of Bitcoin are selling less. This mix means that the market is finding stronger support levels, which makes Bitcoin less vulnerable to sudden drops in price.
Meanwhile, this surge briefly pushed Bitcoin’s price above $123,996 on Friday, according to TradingView data, This was the highest level since August 14. At the time of writing, Bitcoin is trading for $122,396, up 1.75% over the last 24 hours.
Geoff Kendrick, the Global head of Digital Assets Research at Standard Chartered believes the token has a possibility of reaching $135k this quarter amid its current momentum.
October’s bullish start fits well with Bitcoin’s history. The month has often been one of the strongest for the cryptocurrency, with an average return of around 20%, according to CoinGlass. The nickname “Uptober” has stuck in crypto space for this reason, and many are again hoping the pattern holds.
Still, short-term momentum may hinge on upcoming U.S. events. Investors wait for Federal Reserve Chair Jerome Powell’s next speech, the release of the Federal Open Market Committee minutes, and a delayed jobs report, which depends on the length of the ongoing government shutdown.
