Bitcoin ETFs See $172.89M Outflows Amid Market Turmoil
1min read Bitcoin ETFs have recently experienced a significant shift in investor sentiment, with $172.89 million in net outflows recorded over the past week. This marks a notable reversal from the previous two-week streak of inflows, which saw nearly $941 million invested in these funds. The outflows were primarily driven by redemptions from Grayscale’s GBTC, which alone lost $95.5 million over the week. Other major players, such as WisdomTree’s BTCW, iShares Bitcoin Trust ETF (IBIT), and bitwise Bitcoin ETF (BITB), also saw substantial outflows, with redemptions of $44.6 million, $35.5 million, and $24.1 million, respectively.
Despite the overall trend of outflows, some Bitcoin ETFs managed to attract new capital. Grayscale’s Spot Bitcoin Trust, Franklin Templeton’s EZBC, and Fidelity’s FBTC together attracted $61.8 million in inflows, indicating that some investors remain confident in the long-term prospects of Bitcoin. However, Ethereum ETFs were not spared from the market turbulence, posting $49.93 million in outflows last week, extending their losing streak to six consecutive weeks.
Ask Aime: What factors are driving the recent outflows from Bitcoin ETFs and which funds are still seeing inflows despite the market turbulence?
The broader cryptocurrency market was equally affected by the recent market downturn. Bitcoin prices plummeted to nearly $75,000, contributing to a widespread cascade of forced liquidations, with total market liquidations exceeding $1.36 billion in just 24 hours. The brunt of the losses was borne by long-positioned futures traders, with Bitcoin longs alone accounting for over $392 million in losses. Ethereum traders faced a similar fate, with nearly $328 million wiped out of the market. Other altcoins, including Solana (SOL) and XRP, also contributed majorly to the liquidations, with each seeing approximately $60 million in losses.
The market turmoil was further exacerbated by the announcement of new tariff measures by President Trump, which immediately shook traditional and digital asset markets. The announcement spurred fears of a trade war and economic recession, with China quickly responding with its own set of levies on American imports. This escalation of tensions between the world’s two largest economies has added to the overall climate of uncertainty and caution in the markets.
The sudden crash in the crypto and stock markets has led to projections of a looming recession. goldman sachs recently increased the likelihood of a U.S. recession within the next year from 35% to 45%. The market downturn has also raised questions about the impact of regulatory changes and interest rate changes on future inflows into Ethereum and Bitcoin ETFs. Uncertain or restrictive policies could trigger widespread redemptions from Bitcoin ETFs, while rising interest rates could lead investors to move their capital away from high-risk assets like Bitcoin ETFs in favor of safer investments.
