Bitcoin Nears $123,000 Amid Growing ETF Demand
Bitcoin (BTC) is trading close to $123,000 on Wednesday. It may see a strong rally in the fourth quarter. This comes as institutional interest in spot Bitcoin exchange-traded funds (ETFs) grows.
Strong Inflows Expected for Bitcoin ETFs in Q4
Bitcoin ETFs could surpass the 2024 record of $36 billion in inflows. Matt Hougan, Chief Investment Officer at Bitwise, shared this in a note on Tuesday. So far in 2025, ETFs have seen $22.5 billion in inflows during the first nine months.
Hougan expects a big surge in the last quarter. He said, “The stars are aligned for a very strong Q4 for flows — more than enough to push us to a new record and a new all-time high in bitcoin’s price.”
He named three reasons for this growth:
- Bitcoin’s price returns
- The “debasement trade” trend
- More institutional approvals
Morgan Stanley now advises some clients to allocate up to 4% of their portfolio to Bitcoin. Gold and Bitcoin are the top-performing major assets this year. Wall Street calls this the “debasement trade,” betting on assets that do well when fiat currencies lose value.
Since 2020, the US money supply has grown by 44%. JPMorgan has also noted this trend. Hougan says this narrative is becoming mainstream and benefits Bitcoin.
Institutional Buying and Market Momentum
Bitcoin hit a new all-time high of $126,199 on Monday. This was supported by over $3.5 billion in ETF inflows last week. Glassnode, an on-chain analytics firm, reported this is one of the strongest buying waves since April.
Glassnode said steady inflows in October and November could push Bitcoin higher. Historically, Q4 is Bitcoin’s strongest quarter.
Spot volume for Bitcoin reached its highest since April. This shows more liquidity and strength in the market. Futures open interest also hit a record near $50 billion as Bitcoin rose above $120,000.
Annualized funding rates climbed above 8%. This signals strong demand for leveraged long positions and growing speculative momentum. Glassnode noted this does not yet show market overheating. However, rising funding costs have often led to short market pullbacks in the past.
Bitcoin trades near $123,000 on Wednesday. US spot BTC ETFs attracted over $2 billion in the last two days. This sets the stage for possible record inflows by week’s end.
