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Institutional Panic as Bitcoin ETFs See Continued Outflows and Zero Inflows

Have you heard? The spot Bitcoin ETFs in the US are experiencing major outflows for the seventh consecutive day as the Bitcoin (BTC) price plunges. On Monday, there was a total outflow of $174.5 billion across all nine spot Bitcoin ETFs, with no inflows reported. In the past ten days, these Bitcoin ETFs have seen outflows surpassing $1 billion.

Spot Bitcoin ETFs Facing Significant Outflows

Amidst a turbulent week, Bitcoin ETFs have seen a massive $545 million in outflows. Leading the pack is the Grayscale Bitcoin ETF GBTC, which saw outflows of $90.4 million on Monday, pushing the total from its inception closer to $18.5 billion, as reported by Farside Investors.

Fidelity’s FBTC has also felt the burn, with outflows amounting to $35 million on Monday. Since mid-June, FBTC has witnessed consistent outflows, causing its AUM to drop below $10 billion.

Although several other Bitcoin ETFs are experiencing outflows, BlackRock’s IBIT has managed to stay afloat without any outflows since its inception. However, there have been instances of zero inflows in recent times.

The present sell-off signals that the initial hype surrounding the spot Bitcoin ETFs may be dissipating. Institutional interest in Bitcoin has been declining amid global market uncertainties, with Bitcoin investment products recording $630 million in outflows last week.

Bitcoin Struggles in Comparison to US Stock Market

While Bitcoin is on a rollercoaster ride, the US stock market, particularly the Nasdaq index, is on a steady climb. Bitcoin started the year with a bang, capitalizing on the ETF launch for impressive gains. However, Q2 has seen Bitcoin’s price range-bound, unlike the NASDAQ, which has soared over 20% since mid-May, outperforming Bitcoin.

To sustain the Bitcoin rally, a strong catalyst in the form of liquidity infusion is essential. Any indication of a Fed pivot could trigger a significant upward reversal for Bitcoin.


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