On a fateful Monday, May 13, Hong Kong’s spot Bitcoin and Ethereum ETFs experienced a significant outflow of $39.3 million, marking the highest total outflow since their launch on May 2. The spot Bitcoin funds from prominent issuers like Bosera, China Asset Management, and Harvest collectively lost $32.7 million, while Ethereum funds from the same issuers lost $6.6 million. The sudden outflow resulted in a net redemption of 519.5 BTC in a single day, with a daily turnover of $4.25 million. As a result, there are now 3,560 BTC held in the funds, valued at an estimated $222.5 million at current prices. This substantial outflow day reversed the previously positive total flow balance, now standing at a staggering negative $20.9 million, wiping out all gains achieved since the ETFs’ inception.
Contrast with the United States
In stark contrast to the outflow in Hong Kong, Bitcoin ETFs in the United States witnessed a daily inflow of $66 million on the same day. The flows in both directions have stabilized since then. Notable funds like Fidelity’s FBTC and Bitwise BITB saw significant inflows of $38.6 million and $20.3 million, respectively. On the other hand, BlackRock registered a zero inflow but has not seen any outflows since the beginning of May. Grayscale’s GBTC also reported a net zero flow for the day, indicating a slowdown in its outflows. The conversion to a spot ETF has led to substantial losses for the fund, with approximately 330,650 BTC worth around $20 billion lost at current prices.
Market Overview and Performance
Despite the turbulent ETF flows, the overall crypto market has seen a modest 2% increase, reaching a total capitalization of $2.40 trillion at the time of writing. Market conditions have remained relatively stable around this level for the past month, with some anticipated volatility due to this week’s inflation data. Bitcoin briefly touched $63,000 in early Asian trading on Tuesday before retracing to $62,500 at the time of writing, still 15% below its all-time high. Ethereum prices displayed a similar trend, failing to break resistance at $3,000 and settling at $2,930. Altcoins, on the other hand, showed a predominantly positive outlook, with coins like Solana, Dogecoin, Shiba Inu, and Near Protocol outperforming others in a meme coin revival.
The contrasting fortunes of Bitcoin and Ethereum ETFs in Hong Kong and the United States reflect the global sentiment towards cryptocurrencies and the evolving regulatory landscape. As market conditions continue to fluctuate, investors must remain vigilant and adaptable to navigate the ever-changing crypto market dynamics.