Spot Bitcoin ETFs Experience Significant Outflows as Grayscale Bitcoin Trust Leads Losses
Over the course of three to four consecutive days in March 2024, spot Bitcoin exchange-traded funds (ETFs) have witnessed substantial outflows. These ten spot Bitcoin ETFs collectively experienced a net outflow of over $740 million during this period, with the Grayscale Bitcoin Trust (GBTC) leading the losses.
Outflows Reach Record Levels
- The outflows from spot Bitcoin ETFs began on March 18, with $154.3 million exiting the funds.
- On March 19 and 20, the trend continued with outflows of $326.2 million and $261 million, respectively.
- GBTC alone saw an outflow of $386 million on March 20, contributing to its total outflows exceeding $13.2 billion since its launch.
Data from Farside Investors reveals that GBTC’s recent surge in outflows indicates a “second wind” of investor withdrawals, with a staggering $1.4 billion leaving the trust in just one week. This sets a new record for cumulative outflows in ETF history, surpassing all other ETFs in year-to-date outflows.
Bitcoin’s Price Rally Despite Outflows
Despite the significant outflows from spot Bitcoin ETFs, the price of Bitcoin managed to rally above $67,000. This rally was largely driven by the Federal Reserve’s dovish stance. Analysts remain optimistic about Bitcoin’s future and predict a potential consolidation period followed by a surge towards all-time highs.
Moderation in Subscriptions for Other Bitcoin ETFs
While GBTC experienced substantial outflows, other notable Bitcoin ETFs such as BlackRock’s iShares Bitcoin Trust (IBIT) and Fidelity Investments’ Bitcoin ETF (FBTC) saw a moderation in subscriptions during the outflow period. Despite these challenges, the overall performance of these funds remains impressive, with net inflows of $11.4 billion recorded since their launch.
Asian Market Contrasts Global Stocks and Gold
On Thursday, the Asian market showed a different performance compared to global stocks and gold. Bitcoin lost momentum in the Asian market, which can be attributed to the news of outflows from Bitcoin ETFs. This contrasting performance highlights the impact of investor sentiment on cryptocurrency markets.
Hot Take: Bitcoin’s Resilience Amidst Outflows
Despite the significant outflows from spot Bitcoin ETFs, Bitcoin has demonstrated resilience by rallying above $67,000. The Federal Reserve’s dovish stance has played a crucial role in driving this rally. Analysts predict a potential consolidation period followed by a surge towards all-time highs, especially with the upcoming halving event scheduled for next month.
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