Bitcoin ETFs posted their second-highest weekly gain with $3.2 billion in inflows.

Bitcoin ETFs traded on US exchanges began a historically bullish October with the second-best inflow since its launch, signaling renewed investor optimism.

According to SoSoValue, spot Bitcoin ETFs recorded a combined net positive inflow of $3.24 billion last week. This figure nearly matches the record high of $3.38 billion for the week ending November 22, 2024.

This result represents a sharp increase from the $902 million outflow the previous week. Analysts attribute this turnaround to rising expectations for another US interest rate cut, which has improved sentiment toward risky assets.

Growing expectations for another US interest rate cut triggered a “change in sentiment.” This led to renewed investor demand for Bitcoin ETFs, “increasing four-week inflows to nearly $4 billion,” said Ilya Kalchev, fund allocation analyst at digital asset platform Nexo.

“At the current growth rate, more than 100,000 BTC could be withdrawn from circulation in the fourth quarter—more than double the new supply,” the expert believes.

“ETF uptake is accelerating while distribution among long-term holders is slowing, helping BTC strengthen its base,” he added.

US Spot Bitcoin ETFs, Historical Chart, Weekly Chart. Source: Sosovalue

Continued inflows into ETFs could provide significant support for Bitcoin in October. This month is Bitcoin's second-best month in terms of average historical returns, often referred to by crypto investors as “Uptober.”

This week, Bitcoin's price briefly rose above $123,996 on Friday, reaching a more than six-week high. This level was last seen on August 14 for the world's leading cryptocurrency, according to TradingView data.

BTC/USD, 1-day chart. Source: TradingView

A Bitcoin breakout above $120,000 could trigger a “very rapid rally” above its all-time high of $150,000 by the end of 2025, Capriole Investments founder Charles Edwards said in an interview at the Token2049 conference in Singapore.

Uptober is raising hopes for new Bitcoin highs.

Bitcoin ETFs now serve as the “clearest barometer of sentiment” in the crypto industry, pointing to a potential breakout in October, Kalchev said.

“Uptober is showing clear signs of a crypto market breakout at the start of Q4, fueled by ETF inflows, seasonal growth, and favorable macroeconomic conditions.”

However, Bitcoin's dynamics will depend on several key events next week. These include the upcoming speech by US Federal Reserve Chairman Jerome Powell and the release of the Federal Open Market Committee meeting minutes.

Investors are also eagerly awaiting the delayed US employment report. Its release date depends on the duration of the current US government shutdown, the first such shutdown since 2018.

Meanwhile, investors are expecting a strong month for Bitcoin, as October is the second-best month in terms of Bitcoin's historical performance.

Bitcoin Monthly Return. Source: CoinGlass