Market instability and institutional strategies: Will the decline in Bitcoin ETF inflows affect the future of cryptocurrencies?
Decline in Bitcoin ETF Outflows
Last week, the broader market decline also led to selling pressure on Bitcoin ETFs. According to data from SoSoValue, the funds experienced a 73.6% outflow compared to the previous week, marking a new record low for the year. This week, exactly $196.48 million was withdrawn, compared to $744.35 million the previous week.
Bearish Forecasts for Bitcoin ETFs
The Bitcoin ETF market is reacting to uncertainties in the broader crypto market. The Bitcoin ETF market initially saw positive inflows for the first four days of the week ending March 28. However, on Friday, March 28, a significant drop in trading volume occurred, with the products experiencing an outflow of $93.16 million. This ended the industry’s ten-day inflow streak.
While BlackRock‘s IBIT and Fidelity’s FBTC saw massive inflows during this period, other ETF providers such as Franklin Templeton, Valkyrie, VanEck, and WisdomTree contributed little or nothing to the inflow trend.
Bitcoin Price and Market Development
Bitcoin’s performance has essentially dampened sentiment across the broader digital currency system. At the time of reporting, Bitcoin was trading at USD 82,047, down 1.27% over the past 24 hours.
Despite the ongoing outflow of funds from the ETF market, firms like Metaplanet are launching new debt offerings to buy Bitcoin. Their goal is to accumulate the coin at a cheaper price. Institutional adoption of Bitcoin remains positive overall, with Strategy announcing massive acquisitions earlier this month. It remains to be seen whether these developments will impact ETF inflow dynamics.
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