Key Points
- Bitcoin ETFs recorded a significant outflow of $568.8M in a single day, marking a shift in investor sentiment.
- Ethereum ETFs showed resilience, closing 2024 with $35B inflows despite recent outflows.
Bitcoin Spot ETFs experienced a notable change in investor sentiment after three consecutive days of inflows. A massive outflow amounting to $568.8 million was recorded in one day, as per Farside investors.
Bitcoin ETF Update
The most substantial decline was seen in the Fidelity Wise Origin Bitcoin Fund, which had its largest single-day outflow of $258.7 million. This accounted for 45% of the total net outflow.
Ark 21Shares’ ARKB and BlackRock’s IBIT ETF also witnessed significant withdrawals of $148.3 million and $124 million respectively.
While some ETFs reported smaller outflows, others showed no activity, indicating a divergence in market behavior.
The recent outflows from Bitcoin ETFs were the second-highest daily net withdrawal since their inception. This coincided with a significant drop in Bitcoin’s price, which fell below $95k shortly after exceeding the $100k mark on 07 January.
Analysts’ Insights
Analysts attribute this price drop to strong US economic data indicating potential interest rate hikes. Additionally, the Crypto Fear & Greed Index, a measure of market sentiment for Bitcoin and other cryptocurrencies, shifted from “Extreme Greed” to “Greed” over the past month.
Despite positive sentiment, traders remain cautious, believing that Bitcoin’s price volatility may not provide a clear market direction.
Ethereum ETFs Gaining Ground
While Bitcoin ETFs continue to dominate market activity, Ethereum ETFs are gradually narrowing the gap, marked by their impressive $35 billion inflows in 2024, despite recent outflows.
There are concerns over a supply crunch due to predictions of ETFs potentially holding 10-20% of Bitcoin’s supply during peak cycles. However, Ethereum’s resilience and growing investor confidence indicate a possible shift.
If these trends continue, 2025 could be a turning point, potentially positioning Ethereum ETFs as leaders in the crypto investment landscape.
