Bitcoin is at risk of breaking a crucial support price level as US-based spot Bitcoin ETFs have continued to experience outflows following the recent crypto market crash, according to analysts from Bitfinex.
"The lack of institutional accumulation has made the $107,000 to $108,000 zone increasingly difficult to defend as support," Bitfinex analysts stated in a report on Tuesday. They noted significant net outflows after US President Donald Trump’s tariff announcement earlier this month.
Between October 13 and October 17, spot Bitcoin (BTC) ETFs saw around $1.23 billion in net outflows, according to Farside data.
The Bitfinex analysts observed that this data "underscores the current absence of meaningful dip-buying from institutional investors."
This week has seen outflows on two of the three trading days. However, strong inflows on Tuesday have kept overall net flows positive so far at $335.4 million.
Bitcoin ETF Performance Mimics Broader Financial Market
Bitcoin is trading at $108,864 at the time of writing, according to CoinMarketCap. The cryptocurrency had briefly surged above $113,000 earlier in the week before quickly retracing back below $110,000.
Bitfinex analysts indicated that Bitcoin’s price is at a crucial point where it may "serve as a key warning signal" of a more prolonged consolidation period if it moves any lower.
The analysts suggested that such a scenario could occur if ETF inflows do not hold strong. "If weakness persists or ETF inflows fail to recover meaningfully in the coming weeks, it would point to growing demand-side fragility," the analysts explained. They further elaborated:
"Such a scenario could undermine one of the primary forces behind previous rallies - consistent institutional accumulation, heightening the risk of a more prolonged consolidation phase."
Despite these concerns, the consensus among market participants is that Bitcoin will experience an upswing before the end of the year. Prominent figures like BitMEX co-founder Arthur Hayes and BitMine chair Tom Lee continue to predict Bitcoin could reach $250,000 by year-end.
Galaxy Digital CEO Mike Novogratz offered a more cautious perspective on Tuesday, stating that a number of "crazy stuff" would need to happen for such a price target to be achieved.
In a worst-case scenario, Novogratz believes Bitcoin should still hold above $100,000 this year.