ETF Issuers Are Buying Bitcoin 20 Times Faster than Total Mining Output

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Based on a troubling revelation, it appears that entities looking to launch Bitcoin ETFs are buying Bitcoin approximately 20 times quicker than miners are creating new blocks in the network.

Together, they bought over 9,000 units each on Fridays and Mondays, and the buying trend has been steadily growing. Remarkably, this increased consumption rate holds even amidst Bitcoin’s recent dip, implying that it may persist in the future.

Bitcoin and the ETF Issuers

Analysts observed that Bitcoin ETF providers bought approximately 9,000 Bitcoins on January 3rd, which is significantly more than their typical pace. Interestingly, they accelerated this pace even further on Monday, purchasing around 9,600 Bitcoins instead.

Yesterday, US Spot Bitcoin ETFs purchased an enormous 9,624 Bitcoins. That’s about 9,574 more than the usual daily production of around 450 Bitcoins. This is the second consecutive day where purchases exceeded 9,000. Shaun Edmondson commented, “Don’t miss out / don’t hesitate,” as these opportunities may not last forever.

After the Bitcoin ETFs were initially authorized, these 12 issuers have grown into some of the industry’s largest Bitcoin holders (or “whales”). In October alone, they bought five times more Bitcoin than the world produces through mining in a month, and that number has since risen to over twenty times.

Together, they held approximately 5% of the entire supply by November, and they quickly exceeded Satoshi’s holdings not long afterward.

As an analyst, I’ve observed that despite the grandiose labeling of IBIT’s Bitcoin ETF as “the greatest launch in stock exchange history,” the market has faced early challenges in the year 2025. In fact, just last week, IBIT experienced a staggering $330 million outflow, surpassing its own previous records.

Despite facing similar slow periods, this pessimistic sign hasn’t halted the ongoing mergers and acquisitions.

While others experienced similar stagnant phases, this negative indication didn’t put a halt to the continued mergers and acquisitions.

Community members have had concerns for several months that entities like BlackRock and other ETF issuers might disrupt Bitcoin’s fundamental decentralization. The growing trend of buying suggests these fears may be valid.

One month ago, ETFs exceeded the Bitcoin holdings of Satoshi Nakamoto. However, analyst Eric Balchunas pointed out that they are currently just 4% short of surpassing the notorious inventor’s Bitcoin holdings.

In essence, such buying pressure might bring about an indelible change in the cryptocurrency market. Interestingly, just a couple of months back, ETF providers were generating bitcoin at a rate that was fivefold higher than the entire output of Bitcoin miners.

Currently, their production is more than twentyfold, and despite bearish market indications, these high volumes are triggering even larger purchases. At present, there’s no known strategy to reverse or halt this escalating tendency.

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2025-01-08 01:13