Bitcoin ETFs are no stranger to fund leaks. Sometimes, in one day, these newcomers record outflows exceeding hundreds of millions of dollars. An unfavorable situation for Bitcoin, often leading to a sudden drop in prices.
Grayscale GBTC ETF: the exodus continues
Currently, Bitcoin is at half mast. The correlation with the massive outflows from Bitcoin ETFs like Grayscale’s GBTC is obvious. Grayscale is experiencing massive customer departures due to exorbitant asset management fees. These outflows require the funds to be repaid in dollars, thereby putting downward pressure on Bitcoin. A detailed analysis is available in This item.
Record releases for Grayscale’s GBTC: almost 444 million dollars gone in one day, according to Cointelegraph citing Farside Investors. While the BlackRock, Fidelity and Bitwise ETFs have attracted some 117.3 million dollarsmarking the second lowest day for new Bitcoin ETFs, excluding GBTC.
Among them, BlackRock’s iShares Bitcoin Trust (IBIT) saw the most net inflows with $75.2 million, followed closely by Fidelity Wise Origin Bitcoin Fund (FBTC) with $39.6 million. In contrast, the Bitwise Bitcoin ETF (BITB) only managed to attract $2.5 million, its all-time low, excluding days with no inflows.
The record releases represent more than double the previous record set on January 24, marking the second consecutive day of net outflows. With over $23.7 billion in assets under management reported as of March 19, GBTC could exhaust its assets by the end of Julyputting the viability of investments in Bitcoin ETFs at risk.
Since switching from a trust to an ETF on January 11, GBTC recorded nearly $12.9 billion in outflows in 49 trading days.
Bitcoin Plunge: Cascading Fund Outflows and Volatility in Crypto Markets
THE last March 18the GBTC recorded a record net outflow of $642.5 million, bringing total outflows since its transition to an ETF to nearly $12.9 billion. These sustained withdrawals raise doubts about the reliability of Bitcoin ETFs, amid increasing market volatility.
The recent drop in the price of bitcoin, which fell to $62,400 on March 19 after a historic peak of $73,835 on March 14, has heightened fears in the market. With a drop of 5.4% in 24 hours, bitcoin was even trading at $61,173, just above its intraday low of $60,872. At press time, the queen of cryptos was trading at $63,296 per coin.
The correlation between bitcoin price movements and ETF outflows highlights the impact of market sentiment on investment decisions. Investors appear to adjust their positions based on price fluctuations, causing significant outflows from ETFs.
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