Key Points
- VanEck forecasts a potential high-volatility rally for Bitcoin, citing increased BTC holdings by miners, rising corporate treasury investments, and higher Bitcoin ETP flows.
- Public companies have increased their Bitcoin holdings by 8% since mid-September, while Bitcoin ETPs hit a record-high aggregate ownership of nearly 1.1 million bitcoins in late September.
Miners and Corporations Boost Bitcoin Holdings
VanEck’s latest Bitcoin ChainCheck report suggests that Bitcoin is poised for a significant breakout. The investment management firm points to several factors contributing to this outlook, including a notable increase in Bitcoin holdings by miners and corporations.
According to the report, publicly traded Bitcoin miners, who now control a record ~30% of the global hashrate, have significantly increased their BTC holdings. U.S.-listed miners added 2% to their BTC treasuries month-over-month in September, continuing their 11% month-over-month holding trend from August despite increased prices.
Corporate holdings of BTC also saw a substantial rise, increasing by 8% last month. This trend was led by MicroStrategy and several German and Japanese firms. Notably, Japanese real estate manager Metaplanet, Inc. added another 1 billion yen worth of Bitcoin to its treasury, bringing its total holdings to approximately 855 BTC (~$56 million).
Institutional Flows and ETP Impact
VanEck’s analysis highlights the growing influence of institutional investors on Bitcoin’s price. The firm conducted a quantitative analysis on the predictive power between ETP (Exchange-Traded Product) flows and Bitcoin price, concluding that institutional flows are leading price movements rather than following them.
U.S. Bitcoin ETP net inflows totaled $19.4 billion through October 14th, with a strong positive correlation between weekly ETP inflows and Bitcoin’s returns. The report notes that exchange-traded products and other funds hit a record-high aggregate ownership of nearly 1.1 million bitcoins in late September, approaching the same ownership level as Bitcoin’s mysterious creator, Satoshi Nakamoto.
Market Sentiment and Technical Indicators
The report also sheds light on improving market sentiment for Bitcoin. The percentage of Bitcoin addresses in profit grew by 6% over the past 30 days, with nearly nine out of ten addresses sitting on gains. The unrealized profit/loss ratio also improved by 6%, signaling a more positive outlook compared to the summer months.
Bitcoin’s dominance in the crypto market ticked up one point to 57%, maintaining highs not seen since April 2021. VanEck suggests that Bitcoin is uniquely positioned among crypto assets to thrive in either a pro-crypto or crypto-hostile administration, potentially disrupting the usual pattern of Bitcoin dominance peaking around election time.
The report also notes that while sectors like DeFi, L1s, L2s, and GameFi have seen short-term outperformance, Bitcoin has maintained its gains more consistently.
In conclusion, VanEck’s Mid-October Bitcoin ChainCheck paints a bullish picture for Bitcoin, driven by increased institutional interest, growing corporate adoption, and improving market sentiment. As the crypto market continues to evolve, the interplay between traditional finance and digital assets appears to be strengthening, potentially setting the stage for Bitcoin’s next major move.
