Inflows into spot Bitcoin exchange-traded funds (ETFs) in the United States have hit a two-week high, coinciding with a 7% jump in Bitcoin’s price driven by key US inflation data. On May 15, institutional investors poured $303 million into Bitcoin ETFs, marking the highest inflow since May 3.

Institutional Investment Increases

The surge in Bitcoin ETF inflows reflects a renewed bullish sentiment among institutional investors following the release of the US Consumer Price Index (CPI) data, which met market expectations. Leading the inflow was Fidelity’s FBTC fund, which saw $131 million in new investments, its highest daily inflow since March 26. Bitwise’s BITB fund followed with an $86 million inflow, a figure not seen since March 4.

BlackRock’s IBIT fund, however, recorded no inflows for the third consecutive trading day, which experts note is not unusual for a fund of its nature. Despite this, the overall trend for Bitcoin ETFs was markedly positive.

Grayscale Sees Positive Movement

Even Grayscale’s GBTC fund, which had been experiencing outflows for the past four months, saw a reversal with $27 million in new inflows. This marks a significant shift in investor behavior, highlighting a broader trend of increasing confidence in Bitcoin-related investment products.

Hedge Funds Leading the Charge

Recent filings with the US Securities and Exchange Commission (SEC) revealed that Millennium Management, one of the world’s largest hedge funds, holds a $2 billion portfolio in spot Bitcoin ETFs. This portfolio includes substantial positions in BlackRock’s IBIT ($844.2 million) and Fidelity’s FBTC ($806.7 million), making Millennium the largest holder of these funds. The hedge fund, managed by billionaire Izzy Englander, boasts over $64 billion in assets under management.

Prominent ETF analysts, like James Seyffart, have pointed out the significant institutional interest in Bitcoin ETFs, countering the narrative that only retail investors are buying these products.

Other major hedge funds have also disclosed significant stakes in Bitcoin ETFs. Paul Singer’s Elliott Capital reported a nearly $12 million stake in IBIT, while Apollo Management Holdings disclosed a $53 million stake in Ark 21Shares’ ARKB.

Bitcoin Price Surge

The inflow surge coincided with a substantial rise in Bitcoin’s price. The cryptocurrency surged 7% in the past 24 hours, reaching $66,567 during early trading in Asia on Thursday morning. At the time of writing, Bitcoin was trading at approximately $65,900, having gained 15% over the past two weeks. This places Bitcoin just 10% shy of its all-time high.

The recent price increase and ETF inflows were largely driven by the April CPI data, which indicated a lower-than-expected inflation rate of 0.3%. This data suggests a potential easing of monetary policy by the Federal Reserve, which could include rate reductions and increased liquidity in the markets—a positive scenario for Bitcoin and other cryptocurrencies.

Market Outlook

The positive momentum in Bitcoin ETF inflows and the corresponding price surge signal a renewed optimism in the cryptocurrency market. Institutional investors are showing increased confidence, betting on continued growth and stability in Bitcoin’s value. This trend could pave the way for further investment and higher price levels, particularly if macroeconomic conditions continue to favor digital assets.