Bitcoin ETFs in the United States have experienced their largest single-day outflow ever, with $580 million leaving these funds on Monday. This amount surpasses previous outflow highs recorded in May. Investors are adjusting their Bitcoin positions as they prepare for the upcoming U.S. presidential election, which is contributing to a bearish sentiment in the market.
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Among the most affected were the Grayscale Bitcoin Mini Trust ETF (BTC) and Bitwise Bitcoin ETF (BITB), recording substantial outflows of $89.5 million and $79.8 million, respectively. However, not all ETFs took a hit. BlackRock’s iShares Bitcoin Trust ETF (IBIT) remained resilient, securing $26 million in inflows amid widespread outflows, illustrating a divergence in investor confidence.
The Fidelity Wise Origin Bitcoin Fund (FBTC) and the ARK 21Shares Bitcoin ETF (ARKB) also managed notable inflows of $169 million and $138 million, respectively, suggesting selective interest within the Bitcoin ETF market.
Ethereum ETFs followed a similar path, losing around $63 million in total. The Grayscale Ethereum Mini Trust ETF (ETH) and the Fidelity Ethereum Fund (FETH) experienced outflows of $31.94 million and $31.5 million. In the meantime, Ethereum’s price dropped to just above $2,400, marking a 1.6% decrease in the last 24 hours.
The timing of these record outflows suggests that investors are being more cautious as the U.S. election approaches, which adds to volatility concerns in the cryptocurrency market. After briefly reaching $73,000 last week, Bitcoin has seen a 4.6% decline over the past week and is currently trading around $68,300. With fear, uncertainty, and doubt (FUD) impacting market sentiment, the global crypto market cap has fallen by 2.5%, erasing $33 billion and bringing it down to $2.38 trillion.
Jim Bianco of Bianco Research notes that these outflows indicate that the expected influx of new capital into Bitcoin ETFs has not occurred, challenging the optimistic views within the crypto community.
This situation highlights the market’s cautious stance as the election draws near, which may lead to further volatility based on the election results and regulatory changes for cryptocurrencies.
The current market environment is unstable, with Bitcoin and Ethereum ETFs reflecting a mix of investor caution. While some inflows provide a glimmer of hope, the unprecedented outflows underscore the broader market challenges amid the uncertainties surrounding the election.
As traders and investors keep a close eye on the U.S. elections, fresh inflows could help stabilize the crypto market.
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