Bitcoin edged lower on Wednesday after the cryptocurrency reached a five-week high. Even so, the pullback has remained relatively contained as institutional demand continues to improve.
Spot Bitcoin ETFs recorded their sixth consecutive day of net inflows on Tuesday, attracting a further USD 203 million.
The sustained buying marks a notable improvement in sentiment after the heavy outflows seen over recent months.
Nevertheless, the recovery remains modest in a broader context, with July’s inflows still well below the combined USD 6.9 billion of net outflows recorded during May and June.
Geopolitical developments remain another important driver. Ongoing tensions in the Middle East have pushed oil prices to their highest levels in several weeks, reviving inflation concerns. This scenario is particularly important ahead of a busy week of central bank meetings. Market participants will closely scrutinise their guidance for clues on the future path of monetary policy. Expectations that rates could increase continue to underpin global bond yields, creating a more challenging environment for Bitcoin.
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