The price of Bitcoin (BTC) has surged this week following US CPI data that indicated easing price pressures. This rally is also supported by major financial institutions like Morgan Stanley, which disclosed substantial holdings in US spot Bitcoin ETFs.
Bitcoin was trading just below $66,000, after reaching new monthly highs of over $66,750 earlier in the day.
Morgan Stanley reported significant holdings of $270 million in spot Bitcoin ETFs in a Wednesday 13F filing.
Back in February, the US investment banking and asset management giant had indicated its plans to gain BTC exposure.
The bank is also preparing to recommend spot Bitcoin ETFs to its clients.
Morgan Stanley’s disclosure of BTC holdings coincides with many other institutional investors revealing their own holdings.
As of Thursday, Q1 13F filings reveal that over 500 asset managers have exposure to spot Bitcoin ETFs.
Millennium Management currently holds the largest position, with nearly $2 billion in Bitcoin ETFs, accounting for approximately 3% of the hedge fund’s $64 billion in assets under management (AUM).
According to Bloomberg ETF analyst Eric Balchunas, Millennium is the current “king” of ETF holders.
Balchunas highlighted that the new spot Bitcoin ETFs have attracted around 200 times the average number of holders typically seen for a new ETF.
He remarked, “It’s impressive just how many different institution types are represented in the first 13Fs.”
Among these holders is a state pension fund—the State of Wisconsin Investment Board—which disclosed holdings of nearly $100 million in spot Bitcoin ETFs.
Can the Bitcoin Price Retest Yearly Highs?
Bitcoin enthusiasts are optimistic that the renewed interest in Bitcoin’s institutional adoption through ETFs, coupled with favorable macroeconomic conditions, could propel its price above $70,000 in the near future.
On Wednesday, spot Bitcoin ETFs experienced net inflows exceeding $300 million following encouraging US CPI data, according to The Block.
Indeed, Wednesday’s upward momentum allowed Bitcoin to surpass both its 21 and 50-day moving averages (DMAs), reaching new monthly highs.
For Bitcoin to sustain its upward trajectory, it must break through its late April peak above $67,000. Achieving this milestone could pave the way for a rally beyond $70,000 and a potential retest of yearly highs.
The behavior of US equities may serve as a leading indicator for Bitcoin. Currently, the S&P 500 is establishing new record highs above 5,300, following a retracement.
Bitcoin may soon surpass its previous record highs, potentially reaching above $74,000.
However, with only one month passed since the halving, there are no guarantees, especially considering the summer season, which typically sees choppy or bearish trends for risk assets like stocks and Bitcoin. It’s worth noting that this trend may not hold true in election years.
Typically, post-halving rallies take 4-6 months to gain momentum, so a surge to new highs in the next few weeks might be premature.
Nevertheless, this Bitcoin bull run is defying historical norms. Optimism surrounding ETFs previously drove Bitcoin to new highs before the halving, whereas historically, new highs tend to occur post-halving.
Bitcoin is evolving into a mature macro asset, exhibiting less obvious and predictable long-term patterns. The traditional three-year pump and one-year dump cycle, observed over the past 12 years, may not hold as strongly in this evolving landscape.
