The inflow of capital into new Bitcoin ETFs, which had been going strong for months, has now paused. Farside Investors, an investment firm based in London, reported yesterday that investors withdrew nearly $218 million from the products.
A total of eleven Bitcoin exchange-traded funds were greenlit by the SEC in January. By purchasing shares that follow the price of Bitcoin through brokerage accounts, the funds expose investors to the cryptocurrency.
In the weeks after their release, they received record sums of money, indicating their tremendous popularity. One popular option is the iShares Bitcoin Trust (IBIT) from BlackRock.
A major federal economic report showed that the US economy grew at a slower-than-expected rate in the first quarter, prompting the large cash out. After raising interest rates to a 23-year high to combat inflation, the Federal Reserve is unlikely to cut rates any time soon, according to the metrics.
Investors usually avoid “risk-on” assets like Bitcoin when interest rates are high.A total of eleven Bitcoin exchange-traded funds were greenlit by the SEC in January. By purchasing shares that follow the price of Bitcoin through brokerage accounts, the funds expose investors to the cryptocurrency.
In the weeks after their release, they received record sums of money, indicating their tremendous popularity. One popular option is the iShares Bitcoin Trust (IBIT) from BlackRock.
However, yesterday, IBIT did not receive any funds, ending a run of 71 days of inflows. The first outflow from the product since its launch occurred when Grayscale’s ETF lost $139.3 million and Fidelity’s fund (FBTC) lost $23 million.
A 1.1% decline in seven days has brought Bitcoin’s price down to $63,562. Although it has traded at a significant discount from its 2021 high of $69,000 in April, the largest coin reached a new all-time high of nearly $74,000 per coin last month.