US exchange-traded funds (ETFs) focused on Bitcoin reported a remarkable net inflow of $870 million, marking their third-highest daily total. This surge comes as the digital asset nears its record high amidst speculation surrounding the upcoming US elections.
Year-to-Date Inflows Reach New Heights
On Tuesday, the influx of funds pushed the total year-to-date inflows for a group of 12 Bitcoin ETFs to over $23 billion, as per data compiled by Bloomberg. Notable issuers of these ETFs include major financial firms like BlackRock Inc. and Fidelity Investments.
Influence of Political Dynamics
Analysts suggest that the rising demand for Bitcoin can be linked to Republican nominee Donald Trump’s improved standing in election betting markets. Trump’s campaign has embraced digital assets, transforming Bitcoin into what some are calling a “Trump trade.”
While prediction markets favor Trump, polling data indicates a closely contested race against Democratic candidate Vice President Kamala Harris, who has committed to supporting a regulatory framework for the cryptocurrency sector.
Market Reactions and Future Predictions
According to Nick Forster, founder of the crypto trading platform Derive.xyz, Bitcoin options suggest a one-third chance of a price swing exceeding 10% on Election Day, November 5.
As of 6 a.m. Wednesday in London, Bitcoin was trading at approximately $72,480, approaching its all-time high of $73,798 reached in March. The cryptocurrency has surged 73% this year, outpacing returns from traditional assets like stocks and gold.
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