The United States is making a comeback in the Bitcoin world. According to prominent cryptocurrency analyst Ki Young Ju, the US is reclaiming its dominance in Bitcoin holdings, a trend driven by the increasing demand for spot exchange-traded funds (ETFs).
Ki Young Ju, utilizing the “U.S. To The Rest Reserve Ratio” metric developed by his blockchain analytics firm CryptoQuant, has observed a rising ratio of US entities, including exchanges, banks, and investment funds, compared to non-US entities. This ratio has climbed from 1.35 in early July to 1.43 as of September 25th.
This upward trend suggests a significant shift in the landscape. After peaking at 1.50 in March, the ratio experienced a decline, coinciding with higher weekly outflows of Bitcoin and a net capital exit of around $2.37 billion between March and June. However, the tide turned in July, with inflows into Bitcoin ETFs increasing steadily. As of September 25th, the 11 ETFs have amassed $3.41 billion in net inflows.
This growing dominance of the US in Bitcoin holdings reflects a significant move towards institutional adoption of the cryptocurrency. Bloomberg ETF analysts James Seyffart and Eric Balchunas predict that within a year, US ETFs will hold more Bitcoin than even Satoshi Nakamoto, the pseudonymous creator of Bitcoin.
For context, according to on-chain analytics platform Arkham Intelligence, Nakamoto was estimated to possess 1.1 million Bitcoin as of February 2024. Currently, US ETFs hold over $58 billion worth of Bitcoin, with BlackRock’s iShares Bitcoin Trust ETF (IBIT) holding a dominant 40% share.
This trend indicates a strong institutional interest in Bitcoin, potentially driving its future price and adoption. It remains to be seen how far this trend will continue and whether it will ultimately lead to a situation where US ETFs surpass the holdings of even Bitcoin’s creator.
