As the cryptocurrency market was hit by the largest Bitcoin ETF outflow since Trump victory, U.S.-based spot Bitcoin exchange-traded funds saw their outflows reach over $1.5 billion within just four days. This is a dramatic change after a 15-day period of positive inflows totaling $6.7 billion.
The change in investor sentiment is indicated by this massive outflow, which is the largest since Trump’s victory.
Key-Takeaways:
- The Bitcoin ETF outflow since Trump election saw $1.5 billion in outflows on U.S. spot Bitcoin ETFs over four days. Fidelity, ARK, BlackRock’s IBIT, and a number of other funds led to an outflow.
- In contrast, the flow into spot Ethereum ETFs observed $53.6 million of inflows, led by BlackRock’s ETHA. We now have $12.05 billion in Ethereum ETF assets.
BlackRock’s IBIT Leads Massive Exodus
On December 24, BlackRock’s iShares Bitcoin Trust ETF (IBIT) recorded a stunning $188.7 million fund outflow. It was the largest single-day loss among spot Bitcoin ETF outflows since the Trump election victory.
Bitcoin ETF from Fidelity (FBTC) fell just behind with $83.2 million in outflows. Meanwhile, ARK 21Shares Bitcoin ETF (ARKB) had its loss slashed to $75 million.
Although trading volumes have been notable outflows, on Tuesday, the total volume of all the 12 spot Bitcoin ETFs remained $2.16 billion. That’s market activity that persists despite very substantial losses.
Total assets across all Bitcoin ETFs are now $107.53 billion, sinking by almost 15% due to Bitcoin ETF outflow since Trump re-election. The drop is noticeable compared with the $121.7 billion peak of December 16.
On December 19, things got even worse, as $680 million was removed from funds in a single day. However, despite that, the cumulative net inflows are still positive, at $35.68b as of December 24th.
Unlike the Bitcoin exodus, spot Ethereum ETFs remain remarkably resilient. Tuesday’s net inflows of $53.6 million suggest strong confidence from investors.
The first to surge was BlackRock’s Ethereum ETF (ETHA), with an addition of $43.9 million. Bitwise Ethereum ETF (ETHW) posted positive flows of $6.2 million, while Fidelity Ethereum ETF (FETH) posted positive flows of $3.5 million.
Now, total net assets across all Ethereum ETFs come to $12.05 billion. That amounts to 2.94% of Ethereum’s market cap.
Beyond the Boundary of Digital Asset Investment Landscape
Last week was the beginning of more mixed signals for the cryptocurrency investment sector, recording net inflows of $308 million into digital asset investment products. But on December 19, as with plenty of other days this year, there was a $576 million single-day outflow.
Most of the outflow was attributed to market reactions after the Federal Reserve’s hawkish dot plot announcement. The turbulence caused ETPs’ total assets under management to fall $17.7 billion.
While the decline is a given, the 0.37% cut in assets is relatively modest compared with past corrections. That leads us to believe that the market is still finding its way through the challenges with some grit.
Investors seeking exposure to the cryptocurrency market will find Ethereum ETFs as a diversification option. Bitcoin and Ethereum ETFs illustrate that institutional investors are diverging from a purely ‘from the ground’ approach to digital asset allocation.
Conclusion
With lots of money in and heavy institutional interest, market sentiment has shifted as a result of the Bitcoin ETF outflow since Trump re-election. With short-term hurdles to overcome that Bitcoin ETFs will have and having long-term hurdles to overcome, the digital asset ecosystem does form more.
What do you think the recent Bitcoin ETF outflow will mean for the future outlook of cryptocurrencies? Comment below to share your thoughts!
