Spot Bitcoin ETFs Experience Largest Outflow in Two Weeks
U.S. spot Bitcoin exchange-traded funds experienced $194.6 million in net outflows on Thursday, marking the largest single-day withdrawal in two weeks. The exodus follows a smaller $14.9 million outflow recorded the previous day.
BlackRock's IBIT led Thursday's withdrawals with $112.9 million in outflows, while Fidelity's FBTC contributed $54.2 million. VanEck's HODL, Grayscale's GBTC, and Bitwise's BITB also registered negative flows during the session.
Trading Volume Declines as Market Awaits Economic Data
Trading volume across the ETF products declined to $3.1 billion on Thursday from $4.2 billion on Wednesday and $5.3 billion on Tuesday. The reduced activity coincided with broader market uncertainty as investors await key economic data releases.
Bitcoin edged down 1.4% over 24 hours to $91,989 as of early Friday morning. The world's largest cryptocurrency briefly dropped to around $84,000 earlier in the week before recovering to current levels.
Basis Trade Unwinds and Volatility Drive Outflows
Nick Ruck, director of LVRG Research, said the outflows appear driven primarily by ongoing unwinds of basis trades. The futures-spot spread compressed below break-even levels, forcing arbitrageurs to sell holdings amid heightened market volatility.
Ethereum ETFs Also Face Outflows
Spot Ethereum ETFs posted $41.6 million in net outflows on Thursday, reversing from $140.2 million in inflows the previous day. Grayscale's ETHE saw the largest withdrawals with $30.9 million, reflecting similar patterns to Bitcoin ETF flows as cryptocurrency markets navigate ongoing volatility.
Investor Sentiment Hinges on Inflation Data and Fed Decisions
Traders are closely monitoring upcoming U.S. inflation data reports and the Federal Reserve's Dec. 10 rate decision. Expectations of a 25-basis-point cut could potentially stabilize sentiment if it signals further easing, Ruck noted.
Exchange Balances Reach Multi-Year Lows
Timothy Misir, BRN's head of research, reported that exchange balances have fallen to roughly 1.8 million Bitcoin, the lowest level since 2017. The data comes from aggregated CryptoQuant and Glassnode information.
Misir said the market opened with quiet strength as accumulation persists and supply thins on exchanges. Price is stabilizing above the True Market Mean, though a clean break into the $96,000 to $106,000 band remains elusive.