Bitcoin Rally Shifts from Short Squeeze to Institutional ETF Demand

Bitcoin's rally is gaining momentum from institutional demand through spot ETFs. The cryptocurrency climbed over 23% in the past week to around $77,500 on Friday, while U.S. spot Bitcoin ETFs attracted roughly $1.6 billion in net inflows from Monday through Thursday.

This surge is significant as it may signal a shift in the drivers of Bitcoin's rebound. Initially, the rally was fueled by short squeezes, with over $4.3 billion in crypto short positions being liquidated as Bitcoin broke higher.

However, ETF flows offer a more durable catalyst. Standard Chartered analyst Geoff Kendrick believes that Bitcoin's recovery has been supported by both short liquidations and recovering spot ETF inflows, according to Cointelegraph.

Kendrick now thinks his previous $100,000 year-end forecast may be too low, with Bitcoin potentially retesting its $126,000 all-time high before year-end. He views the record as a level Bitcoin could revisit if the recovery gathers further momentum.