Bitcoin Rallies to Surpass $60,000 as Bitcoin ETF Buyers Push Up the Price
March 1, 2024
Stay up to date with our monthly market commentary:
- Spot Bitcoin ETF issuers report record daily volume of over $7.7 billion.
- Bitcoin reaches new all-time-high in 15 currencies.
- Bitcoin (BTC) is up 40.7%, while Ether (ETH) is up 42.7% versus last month.*
Market Overview - February
The price of Bitcoin (BTC) increased by 40.7% in February, at one point reaching a new yearly high of $63,734.
Bitcoin continued its impressive start to 2024 with a strong performance in February and is close to surpassing its previous all-time high of $69,000 in November 2021.
Most of that performance can be attributed to the continued capital flows into the new spot Bitcoin ETFs, which recorded a record daily volume of over $7.7 billion across all ten spot Bitcoin ETFs just as the month closed out.
Bitcoin ETF issuers are currently buying ten times more Bitcoin per day than the amount of Bitcoin that miners are issuing. If this trend continues, the ratio will increase to twenty times more, following the next Bitcoin halving.
Such a supply shock and more demand could result in new all-time highs. In fact, in February Bitcoin reached new all-time highs in 15 fiat currencies.
Altcoins also saw upward momentum as standout performers followed Bitcoin’s lead, increasing user numbers and liquidity. The digital asset market sentiment started 2024 very positively overall, supported by reports that retail investors are regaining trust in the digital asset ecosystem.
Undoubtedly, the halving and the continued capital flow into the Bitcoin ETFs will have the biggest impact in 2024 as key events for investors, financial institutions, and builders within the ecosystem.
Crypto Asset Market Performance Review
The crypto asset market continued to rally after a somewhat disappointing January in which a lot of assets closed the month a leg lower. In February, the crypto market managed to turn things around, and many assets reached new highs.
The standout performers were Ethereum (ETH), Bitcoin (BTC), and Dogecoin (DOGE), rallying 42.7%, 40.2%, and 40.2%, respectively.
Bitcoin’s price increased steadily, boosted by capital inflows into the spot Bitcoin ETFs. Their launch on Wall Street was the most successful in ETF history, with daily volumes in the billions, suggesting that the demand for Bitcoin is there.
Ethereum capitalized on Bitcoin’s success, experiencing a price hike, with more positive news around an impending spot Ethereum ETF. Issuers are talking to the SEC, and if the approval process of the spot Bitcoin ETFs is an indicator, we might soon hear similar news for Ethereum as well.
Not only are institutional investors interested in digital assets, but retail investors are also coming back. One of the most popular assets from the previous cycles has been Dogecoin, with its loyal fan base. The biggest memecoin performed alongside Bitcoin and Ethereum, finishing the month up 40.2%.
Overall, sentiment in the digital asset market has changed and investors, as well as builders, are eager to see what the future holds. Many prominent media outlets and fellow experts have started to call this the first leg of the next bull market.
Bitcoin Tech Update
It’s Bitcoin Layer 2 season!
Several new Layer 2 scaling protocols have emerged to provide new features and functionalities to the Bitcoin ecosystem while taking transactions off the main chain to help scale Bitcoin to billions of people.
New entrants into the Bitcoin Layer 2 landscape include BitcoinOS, Build on Bitcoin (BoB), Merlin Chain, and Botanix, with over two dozen more second-layer protocols under development.
These Bitcoin Layers use different scaling technologies, including Sidechain, State Channels, and Rollups, to provide new ways of interacting with and building on Bitcoin.
Institutional Interest in Bitcoin
February was an eventful month for institutional investors, with BlackRock recording daily trading volumes of over $3 billion for its Bitcoin ETF and an important announcement from MicroStrategy that they’ll double down on the Bitcoin builders' ecosystem.
Blackrock’s IBIT Spot Bitcoin ETF Breaks Daily Trading Volume Record of Over $3 Billion
The Spot Bitcoin ETFs broke various records in their first month of trading and continue to attract more attention. The BlackRock ETF (IBIT) attracted the most interest from investors, with a record daily trading volume of $3 billion in late February.
In total, the ten spot Bitcoin ETFs attracted over $6.7 billion in net capital flows since they launched in January, according to BitMEX Research.
MicroStrategy Doubles Down On Its Bitcoin Strategy by Announcing Further Investments Into Bitcoin Applications
In an interview with Bloomberg TV, MicroStrategy Chairman Michael Saylor announced that his company has continued its Bitcoin buying spree and that MicroStrategy is doubling down on that strategy by offering Bitcoin applications as well in the near future.
Back in 2022, MicroStrategy started looking into the Lightning Network and what kind of possibilities it offers, going as far as announcing that every MicroStrategy email will also be a Lightning wallet address.
Saylor confirmed in his interview that the company is looking further into building Bitcoin applications and enabling various products to onboard fellow public companies as well as small to midsize businesses. The main focus of these applications will be to build a new digital economy on the backbone of the Bitcoin protocol.
Bitcoin on Balance Sheets
Michael Saylor announced an additional purchase of 3,000 BTC, bringing the Bitcoin on their balance sheet to 193,000 BTC.
MicroStrategy’s continuous buying of Bitcoin as a treasury asset highlights the digital currency’s use case as a cash reserve alternative for corporate treasuries.
*Closing price data is from February 28, 2024