Crypto ETF Inflows Fuel Price Gains in Recent Days

Crypto markets have experienced a surge in recent days, driven in part by substantial capital inflows into exchange-traded funds (ETFs). According to data, the majority of trading sessions from May 1st to 8th saw net inflows into Ethereum and Bitcoin ETFs. These inflows are likely contributing to the price gains seen for both cryptocurrencies.

Ethereum ETFs have been particularly notable, with nearly all trading sessions seeing net inflows between May 1st and 8th. The largest single-day inflow was over $101 million on Friday, May 1st. In contrast, Bitcoin ETFs saw two days of outflows, but overall still experienced significant inflows during the period.

The impact of these ETF inflows on prices is indirect, as they do not directly trade on exchanges but rather through over-the-counter (OTC) desks. However, their purchasing and selling activities can influence exchange prices by affecting buying and selling pressure. Since crypto ETFs began buying Bitcoin over two years ago, the number of BTC on exchanges has decreased, potentially reducing selling pressure.