Spot bitcoin ETFs have experienced a significant downturn, with over $1.1 billion in outflows over a seven-day period, coinciding with a sharp decline in bitcoin‘s value.
Leading the outflows was the Fidelity Wise Origin Bitcoin Fund (FBTC), which saw nearly $500 million in withdrawals, erasing gains from earlier in June and late May, according to data from U.K. asset manager Farside Investors. The Grayscale Bitcoin Trust (GBTC) followed closely, losing $357 million. In contrast, the BlackRock Bitcoin Trust (IBIT) saw modest inflows of just $20 million, a stark decrease from its previous records.
The slump began in early June as bitcoin miners sold off assets to balance their books, coupled with profit-taking by investors. This selling pressure contributed to a 6.5% dip in bitcoin’s price, which fell to $58,900 on Monday. This decline mirrored broader market trends, where high-risk assets, including AI chip maker Nvidia, saw significant value drops.
“Yesterday, crypto got hit with some risk asset jitters,” noted analyst Noelle Acheson in her newsletter, “Crypto is Macro Now.”
Despite a brief rally that saw bitcoin trade above $61,500, the cryptocurrency remains well below its all-time high of over $73,000 set in March.
On Monday alone, the 11 spot bitcoin funds experienced $174 million in outflows, marking the fifth-highest daily total for June. The month had initially shown promise, buoyed by positive inflation data and optimism about the potential approval of a second spot crypto ETF based on ether. Bloomberg analyst Eric Balchunas suggests that these proposed funds could receive SEC approval by July 2.
However, investors remain cautious amid broader macroeconomic uncertainties. Strahinja Savic, head of data and analytics at Toronto-based crypto firm FRNT Financial, cited factors such as unclear U.S. monetary policy, major elections in France, the U.K., and the U.S., as well as ongoing conflicts in Ukraine and Gaza, as contributors to market anxiety.
“It’s no surprise to see traders wanting to profit here, manage risk, considering the lack of clarity on so many key issues,” Savic wrote in a message. “Given bitcoin’s liquidity and its 24/7/365 trading availability, it is often the first asset traders will sell to manage risk.”
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