The cryptocurrency ETF market experienced a significant shift on Wednesday as U.S. spot Bitcoin exchange-traded funds (ETFs) posted total daily net outflows of $43.97 million. This marked the end of a two-day streak of positive inflows, stirring concerns among investors.
Leading the outflows was Ark Invest and 21Shares’ ARKB ETF, which saw a staggering $54.03 million exit the fund, according to data from SoSoValue. Grayscale’s GBTC followed suit with $4.59 million in net outflows, while its Bitcoin Mini Trust saw outflows totaling $511,230.
Fidelity Leads Inflows Amid Broader Selloff
While most funds struggled to retain capital, Fidelity’s FBTC bucked the trend, logging $12.57 million in net inflows—the highest among all Bitcoin ETFs for the day. Invesco’s BTCO also managed to attract $2.59 million in inflows, providing a glimpse of optimism in an otherwise bleak trading session.
However, BlackRock’s IBIT ETF, one of the most closely watched in the industry, remained stagnant with zero daily inflows. This marked the seventh consecutive day without new capital for IBIT, a trend that has persisted since August 26.
On Tuesday, the combined daily trading volume for the 12 Bitcoin ETFs hit $1.27 billion, a sharp increase from $712.25 million the previous day. Since their inception in January, these funds have accumulated a total of $17 billion in net inflows.
Ethereum ETFs Also Hit by Outflows
Ethereum ETFs mirrored Bitcoin’s trajectory, experiencing net outflows of $542,870 on Wednesday. VanEck’s ETHV led the exodus with $1.71 million in outflows, while Fidelity’s FETH ETF saw a modest $1.17 million in net inflows. The daily trading volume for Ethereum ETFs reached $126.22 million, up from $102.87 million on Tuesday. Overall, Ethereum ETFs have posted cumulative net outflows of $562.06 million.
Crypto Analyst Links Outflows to Stronger Economic Data
Bitcoin’s price continued its upward momentum, climbing 3.37% over the past 24 hours to $58,318, while Ethereum followed suit with a 1.78% increase, trading at $2,373. Despite these gains, the market sentiment surrounding ETFs remained cautious.
Rachael Lucas, a crypto analyst at BTCMarkets, attributed the recent outflows to stronger-than-expected U.S. economic data. “Outflows from Bitcoin and Ethereum ETFs are largely a reaction to stronger U.S. economic data and should be seen as a normal part of ETF evolution,” she explained.
On the economic front, the U.S. consumer price index (CPI) for August was released on Wednesday, showing a 0.2% rise in consumer prices. This brought the 12-month inflation rate to 2.5%, its lowest since February 2021. The lower inflation rate has fueled market speculation that the Federal Reserve may ease interest rates.
With the Federal Open Market Committee (FOMC) meeting scheduled for next week, investors are closely monitoring potential rate cuts. According to CME Group’s FedWatch Tool, there is an 85% probability that the Fed will lower rates by 25 basis points, a move that could further impact the crypto market and ETF flows.
Also Read: Bitcoin Surges 4.8% To $57,600 – 236,155 BTC Withdrawn As SSR Hits Bottom
In the short term, these outflows could reflect a broader shift in investor sentiment as macroeconomic factors take precedence over crypto-specific developments. However, as Rachael Lucas pointed out, these fluctuations are “a normal part of ETF evolution,” signaling that market participants may just be repositioning their portfolios ahead of potential monetary policy changes.
The coming weeks will prove crucial for both Bitcoin and Ethereum ETFs as investors navigate through economic uncertainty and regulatory scrutiny.
Disclaimer: The information in this article is for general purposes only and does not constitute financial advice. The author’s views are personal and may not reflect the views of Chain Affairs. Before making any investment decisions, you should always conduct your own research. Chain Affairs is not responsible for any financial losses.
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