Bitcoin exchange-traded funds (ETFs) attracted over US$1 billion in net inflows during Tuesday’s trading hours, setting a new record for the highest single-day net inflow.

Bitcoin responded to the movement as it set another price record, this time above US$73,000.

Bitcoin ETFs offer investors regulated exposure to the cryptocurrency without the need for direct ownership.

The introduction of spot Bitcoin ETFs has had a transformative effect on the cryptocurrency market, with inflows surpassing US$11 billion in just two months.

The popularity of these investment products is due in part to their ability to track the price of Bitcoin while allowing investors to trade shares on traditional stock exchanges.

This convenience has attracted significant capital, with BlackRock’s iShares Bitcoin ETF (IBIT) becoming the largest spot Bitcoin ETF, excluding Grayscale’s GBTC ETF.

Bitcoin also getting closer to its halving, an event that reduces Bitcoin inflows by 50% every four years.

Some market watchers expect the decelerating rate of Bitcoin’s supply increase to contribute to the asset’s scarcity, and ultimately, to its price.