As a seasoned researcher who has weathered numerous market storms and witnessed the rise and fall of various investment trends, I find myself intrigued by this latest development in the world of cryptocurrency exchange-traded funds (ETFs). After an impressive streak of net inflows that seemed unstoppable, the sudden shift in investor sentiment over the past week has left me scratching my head.
Over the last week, there seems to be a shift in the environment surrounding the 11 U.S. Bitcoin ETFs, which were previously experiencing significant inflows. This change might be related to the escalating geopolitical tensions in the Middle East.
On a weekly basis, Ethereum-backed funds are experiencing losses as well, with their associated assets seeing significant price drops reaching their recent lows.
Bitcoin ETFs Break the Good Streak
Last week, CryptoPotato noted a favorable trend for Bitcoin ETFs, amassing over $1.1 billion in net inflows within only five business days. Furthermore, the inflow of funds on Friday (September 27) marked the highest amount since early June.
Over the course of a single week, I witnessed Bitcoin’s value skyrocket from approximately $62,000 to surpass $66,500. A promising start indeed. Yet, over the last five trading sessions, the scenario has taken a turn for the worse as investors have shifted their strategies.
As a crypto investor, I observed a disheartening break in our eight-day winning streak on Tuesday, likely due to the intensifying conflicts in the Middle East. The subsequent days were equally challenging for ETFs, with outflows totaling $64.4 million on Wednesday and an additional $54.2 million on Thursday.
Despite Monday and Friday seeing withdrawals totaling $61.3 million and $25.6 million respectively, the overall weekly balance tipped towards losses. In the end, a total of $274.3 million was taken out of U.S.-based ETFs.
The drop in BTC‘s price occurred due to this event. Initially, it plunged from around $66,000 (as of last Sunday) to $60,000 by Wednesday and Thursday. However, it has slightly rebounded to about $62,000 currently. Nevertheless, Bitcoin is still experiencing a weekly decrease of over 5%.
Ethereum ETFs in the Red, too
The spot Ethereum ETFs had a slightly different week but with the same outcome. Monday started with minor outflows of $0.8 million, while Thursday saw $48.6 million taken out. Another $3.2 million was pulled out on Thursday, while investors allocated $19.8 million in net inflows on Wednesday and $7.4 million on Friday.
As an analyst, I can report that the cumulative weekly value for Ethereum ETFs stands at a deficit of $25.4 million. While the outflows for Ethereum were significantly lower compared to those experienced by Bitcoin ETFs, it’s important to note that the price of Ethereum has actually shown a greater decrease.
On Sunday, the second largest digital asset was near $2,700, but it fell by nearly $400 in the middle of the week, reaching approximately $2,300 on Thursday. It has since risen to $2,420, but it remains over 8% lower for the week.
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2024-10-06 14:36