On December 4th, a net outflow of $194.64 million from Bitcoin spot ETFs caused a brief shake in the crypto market. According to SoSoValue data, the most significant outflow of $112.96 million occurred from BlackRock’s IBIT ETF. This withdrawal, amidst a historical total inflow of $62.55 billion into IBIT, indicates that investors are adopting a cautious stance in the short term. Conversely, on the same day, XRP ETFs attracted a net inflow of $12.84 million, garnering much attention. Franklin’s XRPZ fund alone accounted for $5.70 million of this inflow, covering a significant portion of the day’s activity.
Significant Fluctuations in Bitcoin ETFs
As the weekend approached, the situation in Bitcoin ETFs showed slight improvement. On Friday, a net inflow of $54.79 million was recorded. However, BlackRock’s IBIT fund experienced a $32.4 million outflow. Despite this, the cumulative inflows for IBIT remained at $62.517 billion. During the same period, XRP ETFs experienced another surge, with a total inflow of $10.23 million. Notably, Canary’s XRPC fund emerged as the star of the day with an inflow of $4.97 million.
On the Ethereum front, the picture was less favorable. There was an outflow of $75.2 million from ETH ETFs, whereas Solana ETFs provided a positive touch to the market, drawing a net inflow of $15.68 million on the same day.
Market Optimism and Potential Recovery
Bitcoin started December at $85,000, and with a strong recovery within the week, it climbed to the $94,000 range. This rally rekindled discussions about the traditional ‘Christmas run’ among traders. For individual investors, $97,000 is seen as both a strong resistance level and a potential profit-taking zone; however, BTC has not yet fully approached this target.
Despite rising volatility, Bitcoin continues to be the main determinant of the general market direction. While most major altcoins closely follow BTC’s price movements, the sector’s overall sentiment also shapes according to Bitcoin’s trajectory. In recent weeks, the market sentiment, which had been stuck in the “extreme fear” zone, has gradually been rising to the “cautious optimism” level.
Amid these fluctuations, the institutional side is also experiencing active days. Last week, a European asset management company applied for regulatory approval for a new multi-asset crypto ETF, planned to be launched in the first quarter of 2024. Although this fund will focus on Bitcoin and Ethereum, it will also allocate portions for Solana and XRP. Experts indicate that such hybrid ETFs could open new doors, especially for institutional investors seeking risk diversification.
Ultimately, market data suggest that while Bitcoin remains at the center, altcoin ETFs are increasingly gaining attention. Particularly, inflows into XRP and Solana-focused funds indicate that investors are balancing risks as they prepare for 2025. Although short-term volatility remains high, the overall outlook suggests a more stable foundation might form towards the end of the year. Whether Bitcoin can muster the strength to test the $97,000 resistance will be a crucial threshold to monitor as the year draws to a close.