Bitcoin ETFs See $744.35M Inflows, Ethereum ETFs Lose $102.89M
2min read Bitcoin ETFs in the US have recorded their first net inflows in weeks, marking a notable shift in investor sentiment. After experiencing five consecutive weeks of net outflows, Bitcoin ETFs saw a net inflow of $744.35 million between March 17 and 21. This influx of capital signals renewed institutional interest in Bitcoin, despite the ongoing market caution. The most recent net inflow contributed to Bitcoin ETFs’ first weekly gains after five straight losses, with Bitcoin ETFs attracting $83.09 million in cash inflows on March 21. This marked the funds’ sixth consecutive net inflows, highlighting a consistent bullish momentum.
Ask Aime: "Is the resurgence in Bitcoin ETF inflows indicative of a potential market turnaround?"
Five funds contributed to the inflows, with the bulk coming from BlackRock’s iShares Bitcoin Trust (IBIT), which recorded $537.5 million. Fidelity’s Wise Origin Bitcoin Fund (FBTC) followed with $136.5 million. The renewed inflows come after a bearish period for both the crypto market and the broader global economy, marked by growing concerns over escalating trade tensions and rising recession concerns.
In contrast, Ethereum ETFs continued to experience net outflows, with a total of $102.89 million leaving the funds last week. BlackRock's iShares Ethereum Trust ETF (ETHA) saw the largest outflows, a stark contrast to its success with Bitcoin. Ethereum ETFs recorded net outflows, pushing their loss streak to the thirteenth consecutive day. On March 21, Ethereum ETFs lost about $18.63 million, with blackrock Ethereum ETF (ETHA) and Grayscale Mini Ethereum ETF (ETH) losing about $11.94 million and $6.69 million, respectively. The total net assets of Ethereum ETFs also plunged from $6.79 billion to $6.77 billion, representing 2.84% of Ethereum’s market cap.
The divergence in performance between Bitcoin and Ethereum ETFs suggests a shift in investor preferences. Bitcoin ETFs’ cumulative net inflows increased from $35.97 billion to $36.05 billion, while Ethereum ETFs’ cumulative net inflows dropped from $2.44 billion to $2.42 billion. This trend indicates that investors may be favoring Bitcoin over Ethereum in the current market environment. The consistent profits recorded by Bitcoin ETFs have led to their first weekly gains in six weeks, while Ethereum ETFs continue to face challenges.
The recent inflows into Bitcoin ETFs may be attributed to several factors, including institutional interest and market sentiment. Despite the ongoing market caution, investors appear to be bullish on Bitcoin, as evidenced by the consistent net inflows into Bitcoin ETFs. The renewed institutional activity in Bitcoin ETFs suggests that investors may be positioning themselves for a potential recovery in the cryptocurrency market. However, it is important to note that the market remains volatile, and investors should exercise caution when making investment decisions.
Market sentiment on crypto has improved since the past week, with the Crypto Fear & Greed Index improving to 45% from 32 last week. However, Singapore-based investment firm QCP Capital advises caution regarding the likelihood of a sustained breakout. “Upcoming tariff escalations slated for 2 April could once again pressure risk assets,” QCP Cap said in a March 24 market analysis. This cautionary note underscores the need for investors to remain vigilant and consider the broader economic context when making investment decisions.
In summary, the recent net inflows into Bitcoin ETFs and the continued outflows from Ethereum ETFs highlight a shift in investor sentiment towards Bitcoin. While the market remains volatile, the renewed institutional interest in Bitcoin suggests a potential recovery in the cryptocurrency market. However, investors should exercise caution and consider the broader economic context when making investment decisions. The divergence in performance between Bitcoin and Ethereum ETFs indicates a shift in investor preferences, with Bitcoin currently favored over Ethereum in the current market environment. 
