The US spot Bitcoin ETFs, such as GBTC, began June with a bang despite some indication of diminishing hype. These ETFs collectively acquired an impressive 25,729 BTC in the first week alone. This surge in purchases came after a series of fluctuations in previous months, with January seeing 33,456 BTC acquired, followed by 116,561 BTC in February, and 65,456 in March. April then experienced an outflow of 6,074 BTC, which fortunately recovered in May with 25,729 BTC. Notably, the amount of bitcoins purchased in the initial week of June almost matched the entire month of May, according to data from HODL15Capital.
Net Inflows and Outflows
Since their introduction in mid-January, these spot Bitcoin ETFs have seen significant net inflows, totaling nearly $15.7 billion from investors. This total also considers the $17.93 billion in net outflows witnessed by Grayscale’s GBTC during the same timeframe. Collectively managing over $61 billion in total assets under management (AUM), these 11 ETFs are led by BlackRock and Fidelity in the US. Despite a remarkable streak of 19 consecutive days with only inflows, this positive momentum came to a halt after exactly a month. On June 10, Farside data indicated that the ETFs saw $64.9 million withdrawn, with Grayscale’s GBTC being the biggest loser at nearly $40 million. Interestingly, while most experienced outflows, IBIT and BITB actually observed minor inflows.
Market Impact
The outflows from the ETFs had a noticeable effect on the market, particularly on bitcoin’s price, which began to decline in the past 12 hours. Within hours, the asset dropped from slightly above $70,000 to under $68,000, resulting in $170 million in liquidations and dragging the entire market down with it. This sudden shift in price underscores the influence that large-scale withdrawals from these investment vehicles can have on the cryptocurrency market as a whole.
The rise and fall of US spot Bitcoin ETFs in recent months have demonstrated the significant impact these investment vehicles can have on both investor sentiment and market prices. Despite a strong start to June, the abrupt withdrawals and subsequent price drop highlight the volatility and interconnected nature of the cryptocurrency market. Investors and observers alike will need to closely monitor the movements of these ETFs to better understand and navigate the ever-evolving landscape of digital assets.