The Fidelity Wise Origin Bitcoin (FBTC) ETF, a significant player in the spot Bitcoin exchange-traded fund (ETF) market, experienced a setback with net outflows for the first time since its launch in January. This outflow trend had a ripple effect beyond Fidelity Bitcoin ETF, impacting other prominent funds in the cryptocurrency market, such as ARK 21Shares’ ARKB, Valkyrie’s BRRR, and Bitwise’s BITB. Analysts attribute the lack of significant fund inflows to the post-Bitcoin halving environment and the absence of follow-up events focusing attention on Bitcoin in the near term. On the same day, Franklin Templeton’s EZBC emerged as a top performer among affected funds, while Grayscale’s GBTC experienced a substantial outflow.
In a recent report from SoSoValue, Bitcoin also saw significant outflows in the Bitcoin exchange-traded funds (ETFs) market, with Grayscale’s Bitcoin Trust (GBTC) witnessing a net outflow of $79.38 million. This contributes to GBTC’s historical net outflow of $16.46 billion. Conversely, the BlackRock ETF IBIT saw a net inflow of approximately $25.78 million, reflecting a divergent trend in investor sentiment. Preliminary data from Farside Investors reveals a significant decline in BlackRock’s IBIT popularity. For the first time since its launch, the fund failed to attract new investments, contrasting with the modest inflows seen in Fidelity’s FBTC and the ARK 21Shares Bitcoin ETF. Grayscale’s GBTC faced substantial withdrawals, culminating in a net outflow of $120.6 million—the largest since April 17.
At the time of publication, Coinglass data revealed that approximately $58.2 million of Bitcoin was liquidated in the past 24 hours, with long positions accounting for $35 million. On Wednesday, the Fidelity Bitcoin ETF contributed $5.4 million to the total inflow of $9.8 million for the day. BlackRock’s IBIT fund continued its trend of zero inflows on Thursday, mirroring its performance from the previous day. Other funds that reported no inflows on Thursday include Invesco’s BTCO, VanEck’s HODL, WisdomTree’s BTCW, and Hashdex’s DEFI. While there is still notable turbulence in the exchange-traded funds (ETFs) market, with outflow trends in Bitcoin ETFs going up, there are divergent trends in investor sentiment between different funds in the market.
Despite the initial enthusiasm and heavy investments, the sentiment towards Bitcoin ETFs has cooled off this month, dampening previous momentum in the Bitcoin market. Hong Kong is preparing to launch Bitcoin and Ether ETFs by the end of April, aiming to challenge the United States’ dominance in the digital asset space. However, regulatory hurdles and competition with established U.S. financial giants pose significant challenges. While Fidelity’s Bitcoin ETF recently secured a record $40 million investment, concerns persist over low public participation in Bitcoin ETFs, highlighting the growing institutional interest in Bitcoin alongside the challenges hindering broader ETF adoption. The challenges in the cryptocurrency market, particularly for Bitcoin ETFs, reflect the evolving dynamics and uncertainties within the digital asset space.
