Look for Bitcoin ETFs As Bitcoin Price Drops Below $67K, Net Outflows Persist
On Monday, investors withdrew from spot Bitcoin (BTC) exchange-traded funds (ETFs) after the leading cryptocurrency fell below $67,000.
Exits from Grayscale’s Bitcoin ETF (GBTC) jumped once more, hitting almost $300 million on that particular day, according to statistics from investment firm Farside.
The substantial outflow from GBTC was the main factor for the $85.84 million total net outflow for Bitcoin spot ETFs.
However, there was a net inflow of $165 million into BlackRock’s ETF IBIT and a net inflow of $43.99 million into Fidelity’s ETF FBTC.
A total of $12.04 billion has been invested in Bitcoin spot ETFs over time.
The Price of Bitcoin Drops Abruptly
The decline in the value of Bitcoin, which saw a 5% decline to as low as $66,000, is reflected in the negative flows observed in Bitcoin ETFs.
The top cryptocurrency is currently trading at $66,858, down over 4% from the previous day.
The downturn may have dimmed analysts’ hopes that Bitcoin will hit $75,000 before the halving.
The decline in the cryptocurrency market as April gets underway points to a waning impetus in the previous rise, which was highlighted by Bitcoin’s ascent to an all-time high.
The change in attitude is indicative of the cautious approach that is currently dominating international markets due to persistent inflationary pressures in the US.
For this reason, investors are lowering their expectations of the Federal Reserve cutting interest rates and implementing more lax monetary policies.
The expectation of less interest rate decreases by the Fed is having an impact on the cryptocurrency space, according to Stefan von Haenisch, head of trading at OSL SG Pte in Singapore.
This feeling is reflected in the widespread sell-off that has affected several sections of the cryptocurrency market.
Notably, this cautious sentiment is especially felt by meme currencies and other industries that have outperformed Bitcoin over the last six months.
An Increase in Interest in Spot Ethereum ETFs
Application to develop spot Ethereum ETF was filed with SEC last week by cryptocurrency investment firm Bitwise.
After Bitcoin spot ETFs were successfully launched earlier this year, Bitwise is now among numerous competitors in the race to develop the first Ethereum spot ETF.
In line with established financial firms’ increasing interest in providing such products, Bitwise has entered the Ethereum spot ETF market.
Giants in the market including VanEck, Grayscale, and BlackRock have also submitted plans to the SEC in recent months to introduce their own Ethereum spot ETFs.
The need for investment solutions that provide exposure to the second-largest cryptocurrency without forcing investors to buy and keep it directly themselves is highlighted by the rising number of applicants.
A number of well-known Ethereum spot ETF applications, including those from BlackRock, Grayscale, Fidelity, Invesco, and Galaxy Digital, have been subject to SEC delays in decision-making.
Nevertheless, some analysts are still upbeat about Ethereum spot ETFs’ future.
