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Bitcoin rally has ‘room to maneuver’ after $50,000 surge: strategist

Bitcoin (BTC-USD) reached over $50,000 for the first time since late 2021, continuing recent crypto rallies and posting gains of over 17% over the past month. With many inflows attributed to the recent approval of Bitcoin ETF spot offerings, can Bitcoin maintain this trend?

Sean Farrell, Head of Digital Asset Strategy at Fundstrat Global Advisors, and Dante Cook, Head of Swan Bitcoin Business, join Yahoo Finance to discuss Bitcoin ETF inflows and provide insight into the future of Bitcoin.

Cook puts the gathering in context:
“There are a lot of other factors outside of just ETF inflows, although that’s a big reason why…you’re seeing a lot of this price action because these ETF launches have been historic ” Cook said, putting the rally into context. “FBTC, Fidelity’s product (and) IBIT, Blackshare’s product are the number one and two most successful ETF launches of all time. Just as the Chiefs and Patrick Mahomes won back-to-back championships, the latter two weeks, you’ve seen consecutive securities “return to historic levels of dollar inflows into this asset class.”

For more expert insights and the latest market action, click here to watch this full episode of Yahoo Finance Live.

Editor’s note: This article was written by Nicolas Jacobino

Video transcription

It’s been a month since the SEC’s approval of Spot Bitcoin ETFs. Since launch, the funds have generated nearly $3 billion in inflows according to CoinShares. Today, Bitcoin prices briefly topped $50,000, boosted in part by inflows into Spot Bitcoin ETFs. Joining us now for the latest news on all things crypto. Dante Cook, Head of Swan Bitcoin Business at Swan, as well as Sean Farrell, Head of Digital Asset Strategy at Fundstrat Global Advisors. Guys, welcome both of you to the program.

And Sean, maybe I’ll start with you. Sean, it’s been about a month since the SEC approved these new Spot Bitcoin ETFs. What have we learned so far, Sean? Early days, sure, but what have we learned so far about the demand for these new products?

SEAN FARRELL: Well, we’ve learned that it’s important to bring BlackRock into the equation. We have learned that there is a demand for these products. And we also learned that people generally prefer low-cost liquid products over other products that might be more expensive and don’t track the underlying asset as effectively.

Dante, is this indeed why we have seen Bitcoin rebound the way it has or are there other factors at play that people should be aware of?

DANTE COOK: Well, there are many other factors besides just ETF inflows. Although this is one of the main reasons why you see such price movement. Because these ETF launches were historic. More than 5,000 ETFs have been launched over the past 30 years. And FBTC, Fidelity’s ibbett Black equity product, is the number one and number two most successful ETF launches of all time.

And so, just like the Chiefs and Patrick Mahomes won back-to-back championships, I mean, in the last two weeks, you’ve seen back-to-back historic levels of inflow and dollars flowing into this asset class. And when you couple that with things like the Bitcoin halving, where the overall supply of Bitcoin will be cut in half around April, I mean, you see a massive influx of demand, institutional and retail, causing a shock of offer.

So I think there are a lot of different factors here.

And Sean, I’m curious, Bitcoin is going to 50,000 for the first time in over two years. Sean, where do you think prices will go from here, at least in the short to medium term? What sales and sale options do we need to consider?

SEAN FARRELL: Yeah. Look. So we start – our analysis is based – we always start with the macro. And we saw some potential turbulence early in the year, thinking we were going higher, our price target for the year was $125. Certainly not in a straight line. But much of this turbulence, we believe, was going to come from a reassessment of the timing and frequency of any potential Fed rate cuts, as well as potential upward pressure on the long end of the curve due to any potential increase in coupon issuance by the Treasury. .

And if we look at what’s happened over the last few weeks, from just before the ETF launch to today, we’ve weathered a pretty constant barrage of negative macroeconomic variables. We have seen a pretty massive rally in the dollar. We’ve taken into account most of the excessive rate cuts I just alluded to. And we also had some movement – upward movement at the long end of the curve.

All things considered, this paints a pretty constructive picture that having been through this period, given that it’s a $50,000 level, gives me some confidence that this rally in the short term certainly has some room for improvement.

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