Bitcoin has recently shown signs of recovery, supported by a price rebound and renewed capital inflows into U.S.-traded spot Bitcoin exchange-traded funds. Analysts, however, say it remains too early to determine whether the latest move has developed into a sustained upward trend.

Bloomberg Senior ETF Analyst Eric Balchunas said Bitcoin has gained approximately 8% since the 250th anniversary of U.S. independence, outperforming many assets over that period.

Balchunas noted that demand for spot Bitcoin ETFs trading in the United States has strengthened again alongside the recovery in BTC's price. According to the data cited, spot Bitcoin ETFs recorded approximately $750 million in net inflows over the past week. ETF flows have become one of the most closely watched indicators of institutional and retail sentiment toward Bitcoin, as these products collectively manage tens of billions of dollars in assets since launching earlier in 2024.

Spot Bitcoin ETFs are investment products that hold Bitcoin directly and trade on traditional stock exchanges. In the United States, such products began trading in January 2024 after receiving regulatory approval, giving investors a regulated exchange-traded route to gain exposure to BTC without directly holding the asset. Their approval marked a milestone for mainstream financial access to Bitcoin, which previously required using crypto exchanges or custodial wallets.

Still, Balchunas said it is difficult to be fully confident that the current upward movement will be permanent. He said a rebound in Bitcoin after the previous sharp pullback was not surprising, while adding that the asset's future price direction remains unclear.

According to Balchunas, one of the most important sources of pressure on Bitcoin's price has been selling by early investors who have held positions for a long period. He said selling by long-term BTC holders, which has continued for about nine months, has weighed on the price. Long-term holder activity is a metric tracked through on-chain data analytics, and shifts in this behavior are frequently cited by analysts as a signal of changing market dynamics. Balchunas added that Bitcoin could see a stronger recovery if those investors stopped selling.