Spot Bitcoin ETF Flows Sag as Crypto Price Drops

Spot Bitcoin ETF Flows Sag as Crypto Price Drops

Bitcoin's price has fallen more than 7% over the past week.

ETF.com
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Contributing Editor
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Reviewed by: etf.com Staff
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Edited by: Ron Day

After rallying for weeks, flows into spot bitcoin ETFs have sunk into negative territory on three of the past four days as the price of the asset upon which it is based has sagged. 

The 11 funds have totaled more than $300 million in outflows for the week, according to research from U.K.-based asset manager Farside Investors. Tuesday outflows broke a 19-day streak of inflows for the barely five-month-old products that track the largest cryptocurrency by market capitalization. 

Grayscale Bitcoin Trust (GBTC) outflows totaled more than $226 million in outflows, the most among the spot bitcoin ETFs. The fund, a conversion from a trust, carries the highest fee among the products. But the highly successful Fidelity Wise Origin Bitcoin Fund (FBTC) also registered rare outflows on three separate days amounting to more than $116 million, including $106 million on Thursday. The fund has generated more than $9.5 million in inflows since debuting on Jan. 11. 

Even the BlackRock Bitcoin Trust (IBIT), which has accumulated a spot bitcoin best $17.6 billion in assets, received only mild interest, generating just $38 million in inflows for the week. 

etf.com: FBTC flows

On June 4, spot bitcoin ETFs generated $886 million in inflows, the second highest total in the funds' history. and $1.8 billion in inflows for the week. 

Bitcoin's price has fallen more than 7% over the seven days to about $65,000, its lowest level in a month, according to crypto markets data provider CoinMarketCap. The drop is likely result of miners selling holdings to improve their balance sheets, and to a lesser degree, profit taking among large investors, say market observers.

"BTC spot ETF flows often tend to be a function of price," wrote analyst Noelle Acheson, the author of the Crypto Is Macro Now newsletter, via Telegram to etf.com. She added that miners were "probably" responsible for bitcoin selling pressure. 

"This is a typical feature of the post-halving cycle, as unprofitable miners switch off machines and sell BTC reserves, and optimistic miners who want to wait for the market to pick up could be selling BTC to cover operating expenses."

Bitcoin's Price Dip

According to data from analytics firm CryptoQuant, June 9 transfers from mining pools to Binance, the world's largest cryptocurrency exchange, reached a 2-month high over more than 3,000 bitcoin. "This shift aligns with a price correction, that dropped #Bitcoin to $66K," the firm wrote in an X post Thursday. 

The firm noted separately that on June 10, miners sold an additional 1,200 bitcoin via over the counter desks, "the highest daily volume in over two months."

The movement of tokens to trading platforms generally signals that holders of digital assets are looking to sell. 

 

James Rubin is a contributing editor for etf.com, where he produces the Morning Exchange and Weekly Exchange newsletters. A longtime financial writer, editor and book author, he formerly held positions as a news and markets editor for the Americas at CoinDesk, where he focussed on cryptocurrencies. 

He provided editorial guidance for a Wall Street Journal best-selling book on Bitcoin and oversaw a startup newsroom focused on digital financial assets. He has edited for TheStreet and Unchained, where he wrote daily news stories about the trial of fallen crypto entrepreneur Sam Bankman-Fried. His writing has also appeared in The Hollywood Reporter, Forbes.com, AdWeek, Bankrate, The Financial Brand and The Wall Street Journal. He has also written for Forbes Insights and the Economist Intelligence Unit, including papers presented at World Economic Forums in Davos and Mumbai. 

James is the co-author of The Urban Cyclist’s Survival Guide (Triumph Books) and has been interviewed about bike safety on a number of NPR affiliates. In a prior career, Rubin was a world-ranked tennis player, once competing in Wimbledon’s qualifying rounds. He speaks fluent German and is a graduate of the Columbia University Graduate School of Journalism and received his BA at Columbia University.