U.S.-traded spot Bitcoin ETFs faced significant turbulence last week, witnessing net outflows totaling $1.28 billion, marking the highest weekly redemptions since late June. According to SoSoValue data, the cumulative outflows for these funds have climbed to approximately $919 million year-to-date, with October alone accounting for $515 million.
BlackRock’s IBIT Fund at the Epicenter of Withdrawals
The bulk of last week’s withdrawals centered around BlackRock’s iShares Bitcoin Trust (IBIT), the world’s largest spot Bitcoin ETF by assets. IBIT experienced a massive $1.21 billion outflow during the week, with Farside Investors indicating that the fund recorded net outflows for six consecutive trading days through Friday.
BlackRock’s IBIT fund accounted for about 95% of the total weekly withdrawals, losing approximately $1.44 billion since October 30.
Since October 30, IBIT has endured total withdrawals amounting to roughly $1.44 billion, positioning it as the central focus of recent weaknesses in the spot Bitcoin ETF market. In contrast, Fidelity’s Wise Origin Bitcoin Fund, despite experiencing a $200 million outflow on Thursday, ended the week with a net inflow of $93 million.
Market Pressured by Election Uncertainty and Rate Speculations
Bitcoin’s descent below $76,000 last week was exacerbated by a $6.3 billion hack on Binance, alongside uncertainties following the U.S. midterm elections and a selloff in tech stocks. A growing correlation between crypto assets and technology equities has recently influenced ETF flows.
Bitfire Research highlighted alterations in expectations surrounding U.S. interest rates and post-election uncertainties as factors weighing down the crypto market. The firm also mentioned that investors are reassessing the fate of the CLARITY Act, a legislative proposal aimed at clarifying which agency would regulate digital assets before the year’s end.
Glossary: The CLARITY Act is a U.S. legislative proposal intended to clarify the regulatory oversight of digital assets, closely watched for its potential impact on crypto market regulations.
Market Fear Indicators and Price Pressures Monitored
Bitfire Research reported that the Crypto Fear & Greed Index fell to 25, with the Coinbase Premium index turning negative, signaling that Bitcoin was trading at a discount on Coinbase compared to benchmark levels. The firm noted that the market appears to be in a phase of seeking a breakout or bottom.
Bitfire Research emphasizes the potential influence of upcoming U.S. inflation data and Fed signals on the market’s short-term direction.
The research firm cautioned that any sustained dip below the $74,400 to $75,000 range could trigger fresh selling. Bitcoin was last trading at $74,049 according to the latest figures, reflecting a 5% decline over the past week and a 2.3% drop in the last 24 hours.
