Question #52

How have inflows into Bitcoin spot ETFs and reduced miner output influenced supply dynamics and price movements?

Category: General

Related Terms

Circulating Supply

Answer Options

ETF inflows push down prices because ETF issuers sell Bitcoin immediately to balance their portfolios.
Spot ETF inflows have no impact on Bitcoin’s price since ETFs only track Bitcoin’s price movements.
Spot ETF inflows of nearly $4 billion have absorbed more coins than miners can produce, reducing the circulating supply available to other buyers and helping push prices higher. At the same time, reduced miner output means fewer new coins enter the market, further tightening supply.
Reduced miner output floods the market with unsold inventories, causing prices to rise.
Correct Answer
Spot ETF inflows of nearly $4 billion have absorbed more coins than miners can produce, reducing the circulating supply available to other buyers and helping push prices higher. At the same time, reduced miner output means fewer new coins enter the market, further tightening supply.

Why is this the correct answer?

This is correct because when ETFs buy large quantities of Bitcoin, they remove coins from liquid markets. If ETF purchases exceed miner production, fewer coins are available for regular trading, leading to upward price pressure under basic supply‐and‐demand dynamics.

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