Crypto News Today- Bitcoin ETFs Face $200M Net Outflows as Investors React to Fed and CPI Worries
Crypto News– U.S.-listed spot bitcoin exchange-traded funds (ETFs) experienced their second consecutive day of outflows, as traders likely reduced risk ahead of important macroeconomic reports scheduled for later Wednesday. According to data from SoSoValue, the eleven ETFs saw $200 million in net outflows on Tuesday, marking the highest since the $580 million outflows recorded on May 1. This wave of redemptions occurred alongside a sell-off in bitcoin, during which the cryptocurrency briefly dipped to $66,200 before rebounding.
Grayscale’s GBTC was the largest contributor to these outflows, accounting for $120 million. Since its launch in January, GBTC has continued its notorious trend of being the worst-performing ETF in terms of outflows, accumulating a total of $18 billion withdrawn so far.
Fed and CPI Jitters Trigger $200M Net Outflows from Bitcoin ETFs
Ark Invest’s ARKB, Bitwise’s BITB, Fidelity’s FBTC, and VanEck’s HODL all experienced outflows ranging from $56 million to $7 million, with none of the ETFs seeing any inflows during this period. Traders attributed these outflows to precautionary derisking actions ahead of the Consumer Price Index (CPI) reading on Wednesday and the conclusion of the two-day Federal Open Market Committee (FOMC) meeting, where the Fed’s monetary policy will be determined.
According to insights from Singapore-based QCP Capital shared in a Tuesday broadcast message, the market sentiment leaned towards a risk-off mode as investors awaited the outcomes of the CPI release and the FOMC meeting. Additionally, this month’s FOMC gathering is anticipated to reveal the Dot Plot, which provides insight into the Fed’s projections regarding interest rate adjustments for the remainder of 2024.
Despite the short-term uncertainties, QCP Capital maintained a bullish long-term perspective. They suggested that the current market conditions might present an opportune moment to accumulate digital assets, citing upcoming bullish events such as the potential launch of an Ethereum (ETH) spot ETF and the ongoing competition between political figures like Biden and Trump to appeal to the crypto constituency.
FAQs
What caused the $200M outflows from Bitcoin ETFs?
The $200M outflows from Bitcoin ETFs were attributed to concerns surrounding the Federal Reserve’s monetary policy decisions and rising inflation worries. Traders opted to derisk their portfolios in anticipation of potential market volatility associated with these factors.
Which Bitcoin ETFs were affected by the outflows?
The affected Bitcoin ETFs include Ark Invest’s ARKB, Bitwise’s BITB, Fidelity’s FBTC, and VanEck’s HODL. Each of these ETFs experienced varying degrees of outflows, ranging from $56 million to $7 million.
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