Bitcoin ETFs See Continued Outflows as BTC Drops Below $93K

Bitcoin exchange-traded funds (ETFs) in the United States have seen a significant wave of outflows for the third consecutive day, reflecting Bitcoin’s struggle to recover above the $93,000 level after dipping below it in recent trading. Data from SosSoValue highlights that the 12 spot Bitcoin ETFs tracked by the platform saw $226.56 million in inflows on December 23, 2024. However, this influx came after a three-day period where more than $1.18 billion had been withdrawn from these funds, signaling a notable shift in investor sentiment.

The majority of these outflows were concentrated in Fidelity’s FBTC ETF, which experienced the largest withdrawals, totaling $145.97 million. Grayscale’s Bitcoin Trust (GBTC) also saw considerable outflows, amounting to $38.39 million. Additional Bitcoin ETFs that experienced negative flows included Invesco Galaxy’s BTCO, which saw $25.56 million withdrawn, and Bitwise’s BITB, which had $23.75 million leave the fund. ARK & 21Shares’s ARKB also saw $15.75 million in outflows, while other funds like the Grayscale Bitcoin Mini Trust and VanEck’s HODL ETF experienced smaller withdrawals, around $6.18 million and $2.62 million respectively.

The heavy outflows from these funds come amid a broader decline in Bitcoin’s price. On December 23, Bitcoin experienced a sharp 4% drop, moving from an intraday high of $96,386 to a low of around $92,600. The sharp decline was partly attributed to the Federal Reserve’s hawkish stance following its recent interest rate decision. The Fed implemented its third consecutive interest-rate cut, but signaled a slower pace of monetary easing in the coming months to manage inflation. This tempered the speculative enthusiasm in the crypto market, which had been fueled by potential crypto-friendly regulatory changes under President Donald Trump, as well as discussions around establishing a national Bitcoin reserve. As of the most recent data, Bitcoin is trading at $94,436 per coin, reflecting a drop of approximately 11.9% over the past week.

Despite the overall downtrend in Bitcoin, BlackRock’s Bitcoin ETF, IBIT, stood out with positive performance. The fund registered inflows of $31.66 million on December 23, reversing the negative trend seen across other Bitcoin ETFs. This brought IBIT’s total net flows since its launch to an impressive $37.36 billion.

In a contrasting development, Ethereum ETFs had a more positive day. On December 23, the nine spot Ethereum ETFs tracked by SosSoValue recorded a total of $130.76 million in inflows, effectively breaking a two-day outflow streak that had seen $135.4 million exit these funds. BlackRock’s ETHA led the pack with substantial inflows of $89.51 million, while Fidelity’s EFTH followed with $46.37 million in new investments. In comparison, Grayscale’s Ethereum Mini Trust (ETHW) saw a small inflow of $963.72k, while it was one of the few funds to record an outflow, with $6.09 million leaving its coffers.

Despite these fluctuations in ETF flows, Ethereum showed resilience in the market. As of December 23, Ethereum had gained 3.3% in the past 24 hours, trading at $3,412 per coin. This marks a continued recovery for Ethereum, especially after the recent downturn in the broader crypto market, fueled by the uncertainties surrounding Bitcoin’s price action and macroeconomic factors.

Overall, these movements in Bitcoin and Ethereum ETFs underscore the growing impact of institutional investors on the broader cryptocurrency market. While Bitcoin ETFs faced significant outflows amid a price dip and shifting market sentiment, Ethereum ETFs saw a bounce-back, showing continued institutional interest in the second-largest cryptocurrency by market capitalization. With the Federal Reserve’s monetary policies remaining a key factor in crypto market performance, investors are closely monitoring these trends as they position themselves for the next phase in the crypto market’s evolution.