The sentiment surrounding U.S. spot Bitcoin exchange-traded funds (ETFs) remains cautious. On Tuesday, these investment vehicles witnessed another day of net outflows, totaling $148.5 million, according to data from SoSoValue. This continues a trend that began earlier in the week, marking a shift from the inflows that dominated the market since their January launch.
Fidelity’s FBTC led the outflows with a staggering $64.48 million, followed by Grayscale’s GBTC ($32.18 million) and Ark Invest/21Shares’ ARKB ($28.88 million). Interestingly, BlackRock’s IBIT, the largest Bitcoin ETF by net asset value, saw no movement alongside seven other funds.
Despite the negative flow, it’s important to consider the bigger picture. Since their inception, these 12 Bitcoin ETFs have collectively accumulated a net inflow of $17.19 billion, showcasing significant investor interest earlier in the year. Additionally, the trading volume for these funds remains healthy, with $2.2 billion exchanged on Tuesday alone.
However, a different story unfolds in the world of spot Ethereum ETFs. These funds enjoyed a positive inflow of $98.3 million on Tuesday, with BlackRock’s ETHA leading the pack at $109.89 million. This stands in stark contrast to the muted inflows seen by Ethereum ETFs since their launch in July, as highlighted by Augustine Fan, Head of Insights at SOFA.org.
Fan suggests this current inflow for Ethereum ETFs might be a “small rebound” due to a slight recovery in risk sentiment after Monday’s global market downturn. Bitcoin and Ethereum prices also reflect this cautious optimism, with both currencies experiencing slight gains in the past 24 hours.
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Looking ahead, Fan believes the overall direction of cryptocurrencies will likely mirror the performance of high beta stocks (like tech stocks) and risk appetite in the near future. He adds that a sustained recovery in risk sentiment, potentially fueled by a stronger showing from Jerome Powell at Jackson Hole and a potential improvement in Trump’s election odds, could be crucial for a more positive break in the crypto market.
In conclusion, while Bitcoin ETFs are experiencing a period of outflows, it’s essential to consider the long-term inflows and healthy trading volume. Meanwhile, Ethereum ETFs are showing signs of life with recent inflows, suggesting a possible recovery for the altcoin market. However, the near-term future of cryptocurrencies seems to be intertwined with the broader market sentiment and economic factors.
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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