Bitcoin ETFs Add $31 Million: Is the Institutional Interest Returning?

Bitcoin ETFs See Positive Inflows, Ethereum ETFs Struggle with $152 Million Daily Outflow

Bitcoin ETFs – During the Friday Asia trading session, Bitcoin (BTC) showed notable resilience, outperforming the broader cryptocurrency market as tracked by the CoinDesk 20 Index (CD20). Bitcoin surged by 4.4%, testing the $67,000 mark, while the CoinDesk 20 Index rose by 3.3%. This performance underscores Bitcoin’s strength amid ongoing volatility in the crypto sector.

Major Tokens See Mixed Performance

In a significant display of market dynamics, Solana’s SOL led the gains among major tokens, jumping over 5% according to CoinGecko data. Ethereum (ETH), BNB Chain’s BNB, and Cardano’s ADA each saw a 3% increase. Dogecoin (DOGE) also climbed by 4%, whereas the Solana-based memecoin popcat (POPCAT) experienced a substantial rise of over 8%, topping the list of gains in that category.

Ethereum ETFs Experience Large Outflows

For the third consecutive day, Ethereum products led the crypto futures liquidations, with over $70 million in long positions being liquidated, compared to $55 million in Bitcoin-tracked futures. This trend reflects broader concerns within the market.

Open Interest Drops, Indicating Market Exit

Open interest, which represents the number of unsettled futures contracts, decreased by $1 billion over the past 24 hours. This decline suggests a significant amount of capital is leaving the market, potentially signaling a shift in investor sentiment.

Bitcoin ETFs Show Positive Net Inflows

Data from SoSoValue reveals that Bitcoin exchange-traded funds (ETFs) saw a net inflow of $31.16 million, increasing the total cumulative net flow since their launch in January to just under $17.5 billion. The total net assets of these ETFs now amount to $59.14 billion, representing about 4.6% of Bitcoin’s market capitalization. This positive trend contrasts with the situation for Ethereum ETFs.

Ethereum ETFs Face Outflows and Market Comparison

Ether, the second-largest cryptocurrency, rose by 2.8% to surpass $3,200 according to CoinDesk Indices data. However, Ethereum ETFs experienced a net daily outflow of $152 million. Since their introduction this week, the cumulative flow for these ETFs stands at a negative $178.68 million. This situation mirrors the early challenges faced by Bitcoin ETFs.

Historical Context and Market Predictions

CoinShares analysts noted that the current scenario for Ethereum ETFs closely resembles the early days of Bitcoin ETF products. They observed that outflows from the Grayscale Bitcoin Trust (GBTC), the largest Bitcoin fund at the time, negatively impacted Bitcoin’s price initially. However, subsequent inflows into competing funds reversed this trend, driving Bitcoin to a record high in March.

Potential for Ethereum ETFs to Recover Quickly

Mads Eberhardt, a crypto analyst at Steno Research, suggested that the decline in Ethereum ETFs could end sooner than Bitcoin’s did earlier this year, possibly as early as mid-next week. Eberhardt expects strong net inflows to follow, based on recent trends observed in other ETFs.

Contrasting Views on Ethereum ETF Performance

Rachel Lin, CEO and co-founder of SynFutures, expressed a more cautious outlook, anticipating short-term challenges for ETH traders. Lin pointed out that Grayscale’s ETH ETF fund has been a net seller, with over $810 million in outflows since its launch. Grayscale currently holds over $8 billion in Ether, and nearly 10% of this has been sold in the past two days.

Aave Shows Strong Performance Amid Market Fluctuations

Turning to other assets, AAVE, the native token of the Aave decentralized finance (DeFi) protocol, has surged by 15% following a proposal for a token buyback. This proposal, currently in the “temp check” phase, seeks to allocate more protocol revenue towards purchasing AAVE tokens from the secondary market and redistributing them to stakers.

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