The recent slowdown in bitcoin (CRYPTO: BTC) exchange-traded fund (ETF) inflows is a temporary pause, not a negative trend, according to a report by broker Bernstein.
What Happened: Bernstein’s research report suggests that the current slowdown in bitcoin ETF inflows is merely a short-term pause before these funds become more integrated with private bank platforms, wealth advisors, and additional brokerage platforms, CoinDesk reported on Monday. The report notes that the world’s largest cryptocurrency has been range-bound in terms of price, with no clear momentum on either side following the halving.
The report, penned by analysts Gautam Chhugani and Mahika Sapra, states, “There is a natural gestation time to bitcoin becoming an acceptable portfolio allocation recommendation and the platforms establishing the compliance framework to sell bitcoin ETF products.”
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Bernstein maintains its projection of a bitcoin cycle high by 2025 of $150,000, as the “unprecedented ETF demand inflows have further reinforced our conviction.”
The report also notes that the bitcoin mining cycle remains healthy post-halving, with leading players continuing to consolidate market shares. Bitcoin network fees have normalized at a healthy 10% of miners’ revenues after spiking post-halving. The quadrennial reward halving, which took place earlier this month, has slowed the rate of growth in bitcoin supply.
Why It Matters: Cryptocurrency analyst Willy Woo had projected that the introduction of Bitcoin ETFs could potentially drive Bitcoin's price to surpass that of gold. However, there was a significant outflow from Bitcoin ETFs, contradicting the earlier bullish sentiment.
Supporting this outlook, veteran trader Lark Davis referred to Bitcoin’s current consolidation phase as “the calm before the storm,” indicating a potential upswing in the future.
Price Action: As per Benzinga Pro, bitcoin was trading 1.79% lower at $62,359.00 at the time of writing this article.
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