Bitcoin reached an impressive all-time high of $126,200 as global crypto exchange-traded products (ETPs) reported $5.67 billion in inflows, showcasing a revival in investor trust amidst ongoing fiscal and geopolitical uncertainties.

Key Highlights:

• Bitcoin achieved a record high valuation of $126,200, supported by significant ETP inflows of $5.67 billion.
• Growing fiscal and geopolitical risks have renewed focus on the ‘debasement trade’, enticing investors to seek refuge in cryptocurrencies.
• Notably, institutional capital is dominating the landscape, while retail investment has been declining.

In a remarkable uptick, Bitcoin’s high marks this past Monday signal not just a flourishing asset market but also a shift towards value preservation as traditional currencies wane. Asset experts from Bitwise have provided insights stressing the relationship between eroding fiat confidence and increased macroeconomic instability fostering a persistent demand for substantial stores of value like Bitcoin.

Bitcoin Rally Global crypto ETP weekly fund flows. Source: Bitwise

The US Dollar Index (DXY) has seen a drop of 10% this year, while gold has surged 50%, which outstrips Bitcoin’s 27% growth in the same timeframe. Many investors now consider BTC as a digital hedge against currency devaluation.

Per Bitwise, the inflows have been led predominantly by spot Bitcoin ETFs bringing in $3.49 billion, followed by Ethereum with $1.49 billion and altcoin products post $685 million. The predominant activity has been from US-based ETFs, namely BlackRock’s iShares Bitcoin Trust (IBIT) and Bitwise’s BITB.

Onchain data suggests more than 49,000 BTC have been withdrawn from exchanges, while consistent positive spot buying alongside moderate leverage levels herald a stable progression, rather than speculative exuberance.

Conclusively:

“Those investing in either aspect of the asset’s value could converge towards a collective benefit, propelling further capital inflows into digital currencies.”

In the context of current market driving factors, Bitcoin enthusiasts highlight that the fiscal landscape of the United States is becoming increasing pivotal for risk assets. As the yearly debt costs approach $1 trillion, there is an apparent market shift towards expecting prolonged monetary easing—this trend historically serves as a boon for Bitcoin.

Additionally, Tudor Jones compared the current state to the late-90s boom phase despite saturated valuations, suggesting a lack of market euphoria, paired with ongoing institutional interest, could indicate significant upward momentum ahead.

Though, it’s noted by Axel Adler Jr. that the activity from retail traders has declined since spring 2024 in conjunction with Bitcoin’s price rise, hinting at institutional dominance over current bullish trends.

Related: Bitcoin ETFs Post Second-Highest Inflows Since Launch

Disclaimer: This article does not constitute investment advice. Always perform due diligence before making financial decisions.