Spot Bitcoin ETFs Experience Significant Outflows as BTC Drops 3%
Last Week's Outflows
Spot Bitcoin ETFs in the U.S. have recently experienced a significant amount of outflows, even as BTC's price dropped by 3%. In fact, there have been outflows in eight out of the last nine trading days.
$500 Million Withdrawn
In just one week, investors withdrew more than $500 million from these ETFs, even though it was a shorter trading week with only four days.
Impact on BTC Price Movements
These outflows have certainly impacted BTC's market price, which shows a strong correlation with ETF flows.
Skyrocketing Spot ETF Outflows
Since mid-January, when the U.S. Securities and Exchange Commission (SEC) approved nearly a dozen spot Bitcoin ETFs, these financial products have seen widespread adoption.
Initial Positive Trends
From January 26 to February 20, these ETFs had several consecutive days of inflows.
Unstable Periods
However, late April and early May saw a shift, with significant withdrawals, notably on May 1. Mid-May to early June experienced the longest streak of positive flows with 19 consecutive days of inflows.
Uncertainty in the U.S. Economy
Recent instability in the U.S. economy, including the Fed's decision not to lower interest rates, has reversed this trend in the past ten days.
Consistent Outflows
Outflows have been consistent over the past eight out of nine trading days, with June 12 being the only day seeing inflows of $100.8 million.
Major Withdrawals in Recent Week
Even during a shortened trading week, last week saw only withdrawals totaling just under $550 million.
Fidelity and Grayscale Affected
Fidelity’s FBTC saw the highest outflows, surpassing even Grayscale’s GBTC. On Friday alone, $44.8 million were pulled out of FBTC, and $34.2 million out of GBTC. Ark Invest’s ARKB was also in the negative territory.
BTC Price Impact
BTC Price Correlation
As expected, the movement in ETFs has a strong correlation with BTC's price. Over the past week, BTC has mostly seen a downward trend.
Recent Price Movements
After a brief rise from $66,000 to $67,200 on Monday, Bitcoin's value dropped significantly. Yesterday evening, it hit a five-week low of $63,300. Even though it recovered by about a thousand dollars since then, BTC remains down by 3% for the week and its market cap has fallen to $1.265 trillion.
To sum up, the recent trend of spot Bitcoin ETF outflows is having a tangible impact on BTC's price. Understanding these market dynamics can offer insights into broader financial market movements and investor behavior.
