Bitcoin ETFs Experience Significant Outflows as BTC Price Rises
United States spot Bitcoin exchange-traded funds (ETFs) have seen a series of net outflows over the past three days, with a total of $261.5 million exiting the funds on March 20. However, despite these outflows, the price of BTC has experienced a recovery, rising from under $61,000 to $67,000, indicating a 9% increase from the previous day.
Bitcoin ETFs Witness $742 Million in Outflows
According to data from Farside Investors, the net outflows over the three-day period have reached a total of $742 million. On March 18 and 19, there were respective net outflows of $154.3 million and $326.2 million.
- On March 20, there was a significant withdrawal from the Grayscale Bitcoin Trust (GBTC), resulting in $386.6 million exiting the fund. This served as the primary driver of the overall outflows.
- The Invesco Galaxy Bitcoin ETF (BTCO) also witnessed $10.2 million leaving the fund, surpassing the minor inflows from the remaining eight approved ETFs.
Meanwhile, BlackRock’s iShares Bitcoin Trust (IBIT) had its second-lowest net inflow day at $49.3 million, while the Fidelity Wise Origin Bitcoin Fund (FBTC) also had a relatively weak inflow day at $12.9 million.
This marks the second-highest net outflow day for these 10 ETFs, only surpassed by the $326.2 million outflow observed on March 19. However, despite these numbers, market observers remain optimistic about Bitcoin’s resilience.
Bitcoin Bounces Back After Decline
In the past week, Bitcoin experienced a decline from its record high of $73.8K on March 14, which coincided with the final month before the halving event. Historical data has shown that BTC typically falls leading up to the halving, and this pattern seems to be repeating in the final 30 days before the event.
However, Bitcoin has managed to rebound from this recent decline, reclaiming the $67,000 level from $61,000. This indicates the continuation of the bullish trend. Although Bitcoin is approaching a weekly imbalance zone between $59,111 and $53,120, its failure to retest these levels suggests a premature spike in buying pressure, similar to what was seen in November 2021 when the asset reached its prior all-time high.
In addition to its rebound, BTC also responded positively to commentary from the United States Federal Reserve. Following the Federal Open Market Committee (FOMC) meeting, Fed Chair Jerome Powell hinted at potential rate cuts later in the year. This further boosted Bitcoin sentiment among investors.
Crypto Market Experiences Surge Alongside BTC
As Bitcoin rebounds, the broader crypto market is also seeing a surge. Some altcoins are even outperforming Bitcoin in terms of gains. Notable cryptocurrencies such as Floki, Pepe, Bitcoin Cash, Ethereum, and Dogecoin have surged by 38%, 14%, 17%, 10%, and 14%, respectively.
Hot Take: ETF Outflows Don’t Dampen Bitcoin’s Resilience
Despite three consecutive days of net outflows from US spot Bitcoin ETFs, Bitcoin has managed to recover and experience price growth. The recent outflows totaling $261.5 million on March 20 have contributed to a three-day net outflow of $742 million. However, market observers remain optimistic about Bitcoin’s resilience in the face of ETF influences.
Experts like Dyme and Samson Mow suggest that Bitcoin ETF outflows will eventually turn into inflows, advising investors to plan accordingly. This indicates that even though there has been a temporary withdrawal of funds from Bitcoin ETFs, it may not have a significant impact on the overall market sentiment towards BTC.
Furthermore, Bitcoin’s rebound following its decline from the record high and positive response to the US Federal Reserve’s commentary indicate the continued strength of the cryptocurrency. As BTC bounces back, other altcoins are also experiencing significant gains, further contributing to the positive sentiment in the crypto market.
Overall, despite recent outflows from Bitcoin ETFs, the crypto market remains optimistic about Bitcoin’s resilience and its ability to recover and continue its upward trajectory.
Sources: Farside Investors, Dyme
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