On Monday, spot Bitcoin Exchange Traded Funds (ETFs) recorded their second-largest single-day net outflow since their launch in January. Cryptocurrency-based investment products recorded a second consecutive red day ahead of the US elections, ending a seven-day positive streak.
Bitcoin ETFs are seeing a massive churn day
US-listed spot Bitcoin (BTC) ETFs started the month in the red after recording two days of outflows. Investment products performed exceptionally well throughout most of October, recording four consecutive green weeks and crossing the $2 billion mark twice.
Last week Bitcoin ETF recorded $2.2 billion in inflows, marking positive performance for cryptocurrency investment products for the fourth consecutive week. However, the funds saw net flows decline significantly in the October 30-31 period as the price of Bitcoin fell, with inflows dropping from $893.3 million to just $32.3 million.
On Friday, BTC ETFs had their first red day since October 22, ending a seven-day streak with an outflow of $54.9 million. Negative sentiment continued earlier this week, as did Bitcoin-based investment products registered representing the second-largest single-day net outflow since their introduction in January.
The funds recorded their biggest red result on May 2, when $563 million flowed out. Meanwhile, Bitcoin ETFs saw an outflow of $541.1 million on Monday. Bitwise’s BITB, AKR Invest’s ARKB and Grayscale’s Mini Trust (BTC) are reported to have recorded record outflow days on November 4.
BTC ETFs see $541 million in outflows on Nov. 4. Source: Farside Investors
According to data from Farside Investors, BITB and BTC recorded $79.8 million and $89.5 million in outflows, respectively, while ARB reported negative net flows of $138.3 million. Nevertheless, Fidelity’s FBTC reported losses yesterday with outflows of $169.6 million, marking its second-worst day of performance.
IBIT BlackRock was the only BTC ETF to report positive net flow yesterday, with inflows of $38.4 million.
BTC ETFs will continue to thrive
Massive outflows from Bitcoin ETFs occurred just a day before the US election. Experts agreed that market volatility and speculation around the election results had an impact on investment products.
On Tuesday interviewBloomberg analyst Eric Balchunas noted that the election is a gigantic variable that could further impact Bitcoin’s price action and ETF performance.
Nevertheless, he believes the net flow of investment products, which stands at $29 billion, has been “really well thought out” during the “several downturns” seen this year, suggesting the BTC ETFs’ performance will exceed all expectations in their first year , even if the election result will have a negative impact on the market.
Balchunas called ETFs a “major tool” for established investors and a “disruptive powerhouse” that has a “strong spiritual connection” to Bitcoin. For the analyst, these connections make Bitcoin ETFs a sturdy long-term combination.
Meanwhile, Bitwise’s Chief Investment Officer (CIO), Matt Hougan, thinks that “crypto has already won” regardless of the election outcome, but suggested that a Trump victory would be better for the market in the tiny term.
For Hougan, the only possible “bad” outcome would be a Democratic coup. However, in this scenario, he would remain bullish and buy the dip because the last four years have taught him that “Washington can’t stop cryptocurrencies.”
Ultimately, Bitwise’s CIO assured that spot cryptocurrency ETFs will continue to see inflows and the industry will continue to grow even if the market slows.
Bitcoin is trading at $68,738 in the weekly chart. Source: BTCUSDT on TradingView
Featured image from Unsplash.com, chart from TradingView.com
