Bitcoin ETFs Face Historic Outflows Amid Price Plunge
1min read Bitcoin experienced an unprecedented net outflow of $3.546 billion in February, as exchange-traded funds (ETFs) struggled with significant cash outflows. According to data from Trader T, this marked a historic moment where all Bitcoin spot ETFs in the US witnessed negative cash flows, totaling around 40,000 BTC.
BlackRock's iShares Bitcoin Trust (IBIT) saw a notable reduction in its Bitcoin holdings, with a decrease of 9,740 BTC. This brought its total holdings to 573,136 BTC and resulted in a net outflow of $721 million, marking the first monthly outflow since its inception. Fidelity's WisdomTree Bitcoin Trust (FBTC) also reported a net outflow of $1.202 billion, while Grayscale's Bitcoin Trust (GBTC) and Mini Bitcoin Trust experienced a total depletion of $585 million across their products.
The significant cash outflows from Bitcoin ETFs coincided with a steep decline in Bitcoin prices. The cryptocurrency's value plummeted by 18% from $102,400 to $84,300 over the month, highlighting the ongoing volatility within the cryptocurrency market. This decline in price may have contributed to investors' decision to withdraw their funds from Bitcoin ETFs.
The unprecedented net outflow from Bitcoin ETFs in February raises questions about the future of these investment vehicles in the cryptocurrency market. As Bitcoin prices remain volatile, investors may continue to exercise caution when investing in Bitcoin ETFs. However, the long-term impact of these cash outflows on the cryptocurrency market remains to be seen.
