US spot Bitcoin ETFs experienced net outflows of $20.45 million on Wednesday. Interestingly, only two of them made moves amid market uncertainty.
Grayscale’s GBTC saw outflows of $26.99 million, while Fidelity’s FBTC gained $6.55 million. The remaining nine funds, including BlackRock’s IBIT, Bitwise’s BITB and VanEck’s HODL, did not report inflows.
US Bitcoin ETF Market Momentum Fades
according to data Trading volume across these 11 funds reached about $800 million on July 3, down from $995 million the day before, according to a SoSoValue tally. That’s a significant drop from March, when daily trading volumes ranged from $8 billion to $10 billion. Despite the recent fluctuations, these ETFs have attracted a combined net inflow of $14.62 billion since their inception in January.
The U.S. Spot Bitcoin ETF started July strong, recording its highest daily inflows in nearly a month on the first day with a total of $129 million. This is consistent with past patterns, showing that Bitcoin often starts July with an uptrend. After a tumultuous June that saw the Bitcoin ETF take a hit, the new inflows were a positive sign.
However, investor expectations faded as capital inflows subsequently slowed.
July has historically been a strong month for the world’s largest digital asset, but the first week has been anything but eventful, with Bitcoin dropping to $56,770, its lowest level since February.
The recent price drop came after the German government moved another batch of seized Bitcoin tokens. According to Arkham Intelligence, approximately 1,300 BTC, worth nearly $76 million, was sent to three major exchanges: Kraken, Bitstamp, and Coinbase. Another $99 million worth of Bitcoin was moved to another address identified as 139Po.
Moreover, whales are selling again: On July 4, on-chain monitoring platform Spotonchain observed a transfer of 1,700 BTC to Binance, valued at more than $99 million.
This action suggests that these companies are profiting. Additionally, the timing of this move after Bitcoin’s recent price drop suggests it may be a de-risking strategy aimed at reducing Bitcoin holdings.
Increased Bitcoin ETF inflows?
Despite the bleak outlook, Bitcoin ETF inflows could increase.
In a statement CryptoPotatoJag Kuhnar, head of derivatives at Bitfinex, said ETF inflows could increase if market participants believe that “economic uncertainty will eventually lead the Fed to cut interest rates, making Bitcoin more attractive as an inflation hedge.”
“However, any significant inflows will depend on broader market sentiment and risk appetite. Recent inflows have been very disappointing, however, and bargain-buying has been lacking.”
