Bitcoin had an impressive second week of September, closing up nearly 12%, or over $6,000, by the end of Friday’s NYSE session. Although bitcoin fell just $65 short of breaking the critical $60,000 psychological barrier, it ended the week strong at $59,935.

The week started with bullish momentum as bitcoin opened at $54,500 during the Sunday evening futures session. By the close of Monday, bitcoin surged nearly 7% to $57,410.

For the rest of the week, the price remained relatively steady in the mid-to-upper $50,000 range, until Friday saw another significant 4% move, pushing bitcoin just shy of $60,000. The catalyst for this late-week rally was MicroStrategy’s announcement of its latest bitcoin purchase, acquiring 18,300 BTC for $1.1 billion.

This purchase brings the company’s total holdings to 244,800 BTC, reinforcing strong institutional belief in bitcoin’s long-term potential as a store of value.

Bitcoin Dominance Reigns Supreme

Bitcoin’s dominance within the crypto market, a key metric we’ve been tracking, continues its steady ascent. After surpassing the 56% threshold earlier this summer, bitcoin dominance has now risen to nearly 58%. This means that the majority of the capital in the cryptocurrency space is currently concentrated in bitcoin, leaving only 42% in altcoins.

This trend of increasing bitcoin dominance has been ongoing for nearly a year, and based on technical chart patterns and momentum indicators, it appears that this trend will persist in the near term.

Spot ETF Flows Make A Come-Back

After eight consecutive days of outflows, bitcoin spot ETFs turned a corner last week, recording inflows on four out of five trading days. The largest inflow occurred on Friday, with over $263 million in capital flowing into bitcoin ETFs.

Fidelity’s FBTC fund led the way with $102 million in inflows, followed closely by ARK Invest’s ARKB fund, which recorded $99.3 million in new capital. Despite these inflows, total net assets of bitcoin ETFs now stand at $54.31 billion, down from the early June peak of $62.56 billion.

The inflows on Friday marked the second-largest day for institutional bitcoin ETF purchases since July, when $485 million flowed into these funds.

Bitcoin Exchange Balance Continues To Make Record Lows

Bitcoin’s exchange balance metric, which tracks the amount of bitcoin available on exchanges, hit a new yearly low this week, signaling a bullish outlook for the asset. When bitcoin balances on exchanges decline, it typically means that investors and traders are withdrawing bitcoin to place in cold storage, reducing the available supply on exchanges. This creates the potential for a supply shock that could drive prices higher in the future.

In mid-January, around 2.72 million BTC were held on exchanges. Today, that figure has fallen to 2.34 million — a 14% decrease. With a total circulating supply of approximately 19.75 million and a maximum of 21 million bitcoin ever to be mined, a fixed supply combined with decreasing availability could intensify demand and drive prices upward in the coming months.

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