Institutional Bitcoin (BTC) Accumulation Sees Exponential Increase: Report

On-chain data analyzed by blockchain analytics firm CryptoQuant revealed that the institutional accumulation of bitcoin (BTC) has increased exponentially in recent times.

In a Twitter thread, CryptoQuant said the upward trend in BTC accumulation by institutional entities suggests a strong interest in acquiring the digital asset, even at its current price level. Institutional investors refer to hedge funds, crypto private funds, and investment firms.

Institutional Bitcoin Holdings See Upward Trend

According to CryptoQuant, the uptick in institutional bitcoin holdings shows that large entities actively seek long-term investment opportunities in the leading digital asset. Their approach to BTC is more patient, unlike short-term investors, who are more focused on price fluctuations.

“Analyzing the holdings of these funds provides valuable insights into the market dynamics and investor sentiment…Monitoring fund holdings not only provides an understanding of the market sentiment but also highlights the confidence institutional investors have in Bitcoin as a long-term asset,” CryptoQuant said.

The increase in institutional fund holdings could be attributed to the latest series of spot Bitcoin exchange-traded fund (ETF) filings in the United States. In mid-June, the world’s largest asset management company filed an application with the Securities and Exchange Commission (SEC) to launch a spot Bitcoin ETF.

BlackRock’s filing spurred several traditional finance giants to submit new applications for spot Bitcoin ETFs. Besides BlackRock, investment managers WisdomTree, Invesco, VanEck, Fidelity Digital, Ark Invest, and financial services firm Valkyrie have all filed for spot Bitcoin ETFs.

Even though the SEC has deemed the recent spot BTC filings “inadequate,” the development has raised institutional investors’ confidence in the long-term viability of the digital asset.

Bitcoin Sees Inflows of $187M

As institutional fund holdings keep rising, the crypto market sees weekly inflows of roughly $199 million, with BTC being the main beneficiary with a share of 94%. According to data compiled by digital asset investment firm CoinShares last week, digital asset investment products saw the largest weekly inflow since July 2022, correcting almost half of nine consecutive weeks of outflows.

While BTC recorded inflows of $187 million, short-bitcoin products saw outflows of $4.9 million for the ninth consecutive week. This indicates growing investors’ bullish sentiment towards the crypto asset.