Bitcoin Price Surges as ETFs Record Inflows After 8-Day Slump

Cryptocurrency markets traded higher on Tuesday morning as spot Bitcoin exchange-traded funds (ETFs) posted inflows after eight consecutive days of outflows.

Bitcoin (BTC) and Ethereum (ETH) rallied 2%, trading at $56,763 and $2,335, respectively. Solana (SOL) climbed 3%, while Polkadot (DOT) dipped 1%.

According to QCP Capital analysts, the market will be closely watching Kamala Harris’ policy cues in her debut debate today.

“While BTC is generally seen as the “Trump trade” due to his vocal support for crypto, we believe the real surprise could come from Harris if she brings up crypto positively during her campaign,” the firm noted.

Harris has not made any direct statements on cryptocurrency or blockchain so far.

CryptoQuant data indicates a rapid increase in USDT holdings on exchanges since August, indicating potential buying interest.

From March to July, USDT reserves remained relatively stable around 14 billion USDT. However, in August, these reserves surged sharply, reaching approximately 17 billion USDT by September.

“When stablecoins flow into exchanges and increase their holdings, it is generally interpreted as funds waiting to buy, which will have a positive effect on the price. Of course, increasing holdings does not necessarily mean the price will rise,” wrote CryptoQuant contributor Yonsei dent.

On Tuesday, $32 million in Bitcoin shorts and $17 million in Ethereum shorts were liquidated, according to CoinGlass data. Shorts are bets that the price of an asset will decrease, allowing traders to profit from the decline.

The 11 U.S. Bitcoin ETFs recorded net inflows of $28.6 million on Monday.

According to data from Farside Investors. Fidelity's Fidelity Bitcoin Trust (FBTC) logged inflows of $28.6 million on Monday, while Bitwise's Bitwise Bitcoin Fund (BITB) recorded inflows of $22 million and ARK 21Shares Bitcoin ETF Bitcoin ETF (ARKB) had $6.8 million in inflows. Grayscale's Grayscale Bitcoin Trust (GBTC) recorded continued outflows totalling $22.8 million.

Spot Ethereum ETFs reported $5 million in outflows last week, mostly from Grayscale's Grayscale Ethereum Trust (ETHE).

Stock Market Rallies

The S&P 500 and Nasdaq Composite edged higher on Tuesday as investors hoped for an interest rate cut from the Federal Reserve next week to ease economic concerns.

Traders are focusing on two key economic reports — the consumer price index (CPI) report for August due on Wednesday and the producer price index (PPI) report due on Thursday.