In the wake of President Donald Trump’s announcement to halt new tariffs, financial markets witnessed a significant rally. However, this positive momentum did not extend to Bitcoin exchange-traded funds (ETFs), which faced substantial withdrawals amounting to $127.12 million on Wednesday alone. The most notable outflow occurred in BlackRock’s IBIT fund, which experienced a net withdrawal of $89.71 million, while Grayscale’s GBTC fund saw a reduction of $33.8 million, alongside similar trends from VanEck and WisdomTree.
Why Did Outflows Persist Despite Bitcoin’s Rise?
Despite the concerning outflows from most spot Bitcoin ETFs, there was a silver lining with Bitwise’s BITB fund attracting an inflow of $6.71 million. This indicates a cautious investor sentiment as outflows continued for the fifth consecutive day, even amidst broader market optimism.
Trump’s announcement to delay tariffs and reduce customs duties to 10% spurred positive reactions across markets, with the U.S. stock indices closing on a high note. Bitcoin increased by 7.16% to reach $82,115, while Ethereum surged by 11.08% to settle at $1,617.
How Did Global Markets React to Trump’s Announcement?
The ripple effects of Trump’s tariff suspension were felt globally, with the Dow Jones climbing by 7.87% and the S&P 500 up by 9.52%. The Nasdaq saw its most considerable single-day increase since January 2001, soaring by 12.16%. Notably, shares of Coinbase jumped by 16.91%, while Strategy, a firm focusing on cryptocurrency, rose by 24.76%.
The bullish sentiment in U.S. markets also resonated in Asia, with Japan’s Nikkei 225 climbing by 8.68%. Similarly, South Korea’s Kospi index increased by 6.07%, while China’s Shanghai Composite Index and Hong Kong’s Hang Seng Index rose by 1.34% and 3.13%, respectively.
Jeff Mei, COO of BTSE, pointed out that market enthusiasm stems from hopes of agreements between the U.S. and its trading allies, though investors remain vigilant regarding ongoing U.S.-China tensions.
- Bitcoin and Ethereum prices surged significantly post-announcement.
- BlackRock’s IBIT fund saw the highest outflow among Bitcoin ETFs.
- Global markets reflected positive sentiment following Trump’s tariffs suspension.
Market dynamics are shifting, with Bitcoin demonstrating strength despite ETF withdrawals. Investor behavior reflects a complex interplay of optimism in equities and caution in cryptocurrency investments, suggesting a nuanced market landscape ahead.
