Bitcoin ETFs: After Record $328M Outflows, What Happens Next?

Ibrahim Ajibade
Published: Apr 28, 2024, 18:15 GMT+00:00

Key Points:

  • Bitcoin (BTC) ETFs recorded $328 million outflows last week, the highest since the SEC approval in January 2024.
  • Rumors of another post-Halving crash appears to have spooked institutional Bitcoin investors into taking a cautious stance over the past week.
  • Amid slowing institutional demand BTC bulls have managed to keep prices above $60,000.
Bitcoin (BTC) price forecast

Throughout the week ending on April 26, 2024, Bitcoin Spot ETFs in the U.S. experienced notable fluctuations in net flows.

Moreover, these ETFs registered a massive weekly net outflow of $328 million as institutional investors cut down on their BTC positions in a bit to avoid a potential post-halving crash,

Overview Of Bitcoin ETF Weekly Flow

At the time of writing on April 28, the 10 Bitcoin ETF hold a cummulative balance of 825,320 BTC (~$52.5 billion), after a turbulent week.

The week began with robust activity, witnessing total net inflows of $62.02 million across various Spot BTC ETFs.

Meanwhile, Grayscale’s GBTC suffered a single-day net outflow of $34.993 million, while Fidelity’s FBTC recorded a significant single-day net inflow of $34.83 million. Moreover, BlackRock’s IBIT Bitcoin ETF recorded an inflow of $19.4 million, boosting its inflow streak to 70 days after launch.

Bitcoin ETFs Holdings April 28, 2024 | Source: TheBlock
Bitcoin ETFs Holdings April 28, 2024 | Source: TheBlock

Moreover, on Tuesday, April 23, the positive momentum continued as Farside UK data revealed net Bitcoin ETF inflows of $31.6 million. BlackRock’s IBIT and Ark 21Shares’ ARKB led the surge with notable inflows, contrasting Grayscale’s higher outflows on the same day. However, the inflows halved from the previous day owing to GBTC’s surging outflows.

Thereafter, on Wednesday, April 24, a shift occurred with net outflows totaling $120 million, coinciding with a peak in trading volumes. Grayscale’s GBTC experienced the largest outflow, while Fidelity’s FBTC emerged with the highest net inflow.

On Thursday, April 25, the Bitcoin ETF outflows intensified, reaching a staggering $217 million across all 10 Spot Bitcoin ETFs. Grayscale’s GBTC led with $140 million in outflows, followed by other ETFs experiencing significant withdrawals.

On Friday, April 26, outflows persisted, totaling $83.6 million, with Grayscale’s GBTC seeing a slowed outflow compared to previous days. Notably, Ark 21Shares’ ARKB was the only ETF with inflows. The ARKB Bitcoin ETF saw a modest inflow of $5.4 million. Overall, the week showcased a gigantic outflow of $328 million.

What’s Next For Spot BTC ETFs?

During a huge selloff in the crypto market, speculations regarding the future of Bitcoin ETFs have emerged. This follows a recent report indicating a fresh decline in the investment vehicle. Particularly alarming is the recent announcement from the Deposit Trust Company (DTCC) regarding the valuation of collateral for ETFs containing BTC or other cryptocurrencies, sparking unease among investors.

The landscape of U.S. Spot Bitcoin ETFs has been tumultuous of late, with significant capital outflows observed this week. This trend has sparked worries among investors regarding waning interest from major players on Wall Street in the leading cryptocurrency. Furthermore, this development appears to have contributed to the recent sell-off in the crypto market.

In addition, a recent report from 10X Research has cast doubt on the BTC ETF scene, citing the DTCC’s decision to impose a 100% haircut on ETFs with cryptocurrency exposure starting April 30. There are speculations of a potential reversal in Bitcoin ETF inflows is expected. Meanwhile, the crypto market is struggling with increased volatility and significant outflows from the U.S. Spot Bitcoin ETFs.

Significantly, the DTCC’s move to withhold collateral value from ETFs featuring cryptocurrencies as underlying assets has reverberated throughout the digital asset market. With Bitcoin showing signs of forming lower highs, 10X Research has forecasted a new downward trend for Bitcoin ETFs.

About the Author

Ibrahim Ajibade Ademolawa is a seasoned research analyst with a background in Commercial Banking and Web3 startups, specializing in DeFi and TradFi analysis. He holds a B.A. in Economics and is pursuing an MSc in Blockchain.

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