Key Points
- Spot Bitcoin ETFs in the US have seen a resurgence in net inflows following President Trump’s decision to pause tariffs on Canada and Mexico.
- Bitcoin briefly reclaimed the $100,000 key level after the news, indicating a potential bullish resurgence.
Spot Bitcoin exchange-traded funds (ETFs) in the United States have seen an increase in net inflows after the suspension of tariffs on Canada and Mexico by President Donald Trump. This decision was made after discussions with the respective country leaders.
ETF Inflows and Bitcoin’s Response
Data from Farside Investors shows that on February 4th, the 12 spot Bitcoin ETFs recorded a net inflow of $340.7 million. This is a significant shift from the outflows recorded the previous day, when these investments witnessed $234.4 million in net redemptions.
The leading ETF in inflows was BlackRock’s IBIT, with $249 million entering the fund. ARK and 21 Shares’ ARKB followed with $56.1 million in inflows.
Positive net flows were also experienced by other ETFs such as Grayscale’s GBTC and Bitwise’s BITB. In contrast, seven ETFs reported no inflows or outflows, indicating a pause in investor activity.
The inflows into the 12 Bitcoin ETFs were triggered by President Trump’s agreement to suspend the controversial 25% tariffs on Mexico and Canada for a month. This move coincided with Trump signing an executive order to establish a sovereign wealth fund, leading to speculation that the U.S. might use it to purchase Bitcoin.
Following this news, Bitcoin briefly surpassed the $100,000 key level on Feb. 4. Other cryptocurrencies like Ethereum, Solana, XRP, and Dogecoin also posted significant gains, indicating a potential bullish resurgence.
Market Reactions and Predictions
This recovery followed a market-wide decline that resulted in over $2 billion in liquidations in the crypto derivatives market. This happened after Trump’s tariff announcement on Canada, Mexico, and China, which caused the crypto market to briefly lose over $500 billion on Feb. 3.
At the time of reporting, Bitcoin (BTC) was trading at $98,070, a decrease of 1.3% over the past day.
Matt Mena, a crypto research strategist at 21Shares, stated that while the tariffs caused short-term volatility, they could lead to a longer-term shift that ultimately benefits Bitcoin. He suggested that this period of volatility could set the stage for Bitcoin’s next major expansion, with macroeconomic conditions aligning for Bitcoin to potentially surpass previous all-time highs.
