This week saw significant turbulence in the Bitcoin Exchange Traded Funds (ETFs) market, with total net outflow approaching $900 million. Moreover, this coincides with the retreat in Bitcoin (BTC) price and the collapse of the crypto market. The biggest contributor to these outflows was the Grayscale Bitcoin ETF (GBTC), which has seen a staggering total of $14 billion in outflows since its January 2024 launch.
Spot Bitcoin ETFs record outflows all week
BTC ETFs recorded outflows of over $888 million this week. On Friday, March 22, Spot Bitcoin ETFs experienced a significant net outflow of $51.6 million, while GBTC alone recorded a single-day outflow of $169 million. In contrast, BlackRock’s ETF (IBIT) observed minimal net inflows, mitigating some of the negative impact.
Despite Bitcoin’s price pressure, currently trading at $64,051 with a market cap of $1.259 trillion, analyst Michael van de Poppe sees consistent inflows into BlackRock’s Spot Bitcoin ETFs as a positive sign of ongoing institutional buying activity, suggesting the market cycle is not over yet. progress.
Persistent rises in GBTC
GBTC’s persistent outflows continue to negatively impact the Bitcoin ETF market. On Thursday, March 21, there was another significant outflow of $359 million, for a total of $1.8 billion for the week. Moreover, Bitcoin ETF outflows accelerated, reaching $95 million on March 21 and $261 million on March 20, for a total of $742 million in three days.
GBTC faced a significant single-day outflow of $386 million on Wednesday, March 20, while IBIT recorded a significant inflow of $49.28 million, bringing its total historical net flow to $13.09 billion. But concerns about the central bank’s actions caused ETF inflows to dry up this week.
What’s the latest on market sentiment?
Market sentiment appears to be changing, with Bitcoin ETFs experiencing consecutive days of outflows totaling $326 million on Tuesday, March 19. cryptokoin.com As we reported, institutional investors appeared cautious ahead of the FOMC’s March 20 decision. This was reflected in weak inflows across most ETFs. GBTC’s woes continued on Tuesday with a massive outflow of $444 million, further exacerbating its losses.
In contrast, BlackRock’s Bitcoin ETF regained momentum on Monday, March 18, recording inflows of $451.5 million. This contrasts with the minimum inflows in other ETFs. Bitcoin recently made a major pullback after reaching an all-time high of $73,836 earlier this month. BTC price dropped below $61,000 and rebounded above $67,000 amid increased volatility. However, despite the recovery, the Bitcoin price fell back to the $65,000 level.
The recent recovery in Bitcoin’s value was met with a short squeeze. According to Coinglass, short liquidations of approximately $30.68 million were recorded for BTC out of total liquidations of $48.31 million. Investors in these short positions are expected to buy back their positions to reduce potential losses. Moreover, this move could momentarily push the Bitcoin price higher and come with a major correction later.
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