Bitcoin ETFs Experience Significant Outflows Amid Market Adjustments

By: Isha Das

The new year has commenced with notable outflows from both Bitcoin and Ethereum exchange-traded funds (ETFs) as investors reassess their portfolios following a year of volatility in the cryptocurrency markets. According to SoSoValue data, these combined outflows from spot Bitcoin and Ethereum ETFs exceeded $310 million. Such movements underscore investor sentiment as they navigate various economic factors impacting the market.

On January 2, BlackRock's iShares Bitcoin Trust (IBIT), the leading spot Bitcoin ETF, witnessed its largest outflow to date. Investors pulled out approximately $332 million, equating to more than 3,500 BTC, surpassing the previous holiday season's record outflow of $188 million. Despite the significant outflows, IBIT continues to lead the spot market with total net inflows of $36.9 billion, managing assets worth roughly $53.5 billion.

While BlackRock's product faced withdrawals, other ETFs displayed resilience. For instance, Bitwise's BITB, Fidelity's FBTC, and Ark 21Shares' ARKB registered inflows amounting to $48.3 million, $36.2 million, and $16.5 million, respectively. These numbers reflect varying investor strategies and confidence levels in response to market changes. As of the recent report, spot Bitcoin ETFs collectively manage around $109 billion in assets.

Ethereum-linked ETFs also experienced a similar fate with outflows totaling $77.5 million, led by Bitwise's ETHW losing $56.1 million, while Grayscale's ETHE saw withdrawals of $21.4 million. In contrast, BlackRock's Ethereum-focused ETHA ETF reported no fund flow changes. Despite the outflows in Bitcoin and Ethereum ETFs, the sector holds promising assets with Ethereum-focused ETFs managing a combined net inflow of $2.58 billion and $12.4 billion in assets.