Bitcoin Investors Pull Out of ETFs Before Key Economic Events
Investors in Bitcoin ETFs are selling their shares for the second day in a row, likely due to upcoming economic reports that could impact the market.
According to data, these spot Bitcoin ETFs listed in the US saw a net outflow of $200 million on Tuesday. This is the highest outflow since early May, when the figure hit $580 million. The outflows coincided with a Bitcoin price dip, where the cryptocurrency briefly fell to $66,200 before rebounding.
Grayscale’s GBTC ETF was the leader in outflows, accounting for $120 million of the total. GBTC has actually seen the most outflows of any Bitcoin ETF since its launch in January, with a cumulative total of $18 billion. Other notable ETFs like Ark Invest’s ARKB, Bitwise’s BITB, Fidelity’s FBTC, and VanEck’s HODL also saw outflows, ranging from $7 million to $56 million.
Experts believe these outflows are a sign of investors being cautious before key economic events. The Consumer Price Index (CPI) report is due on Wednesday, followed by a two-day Federal Open Market Committee (FOMC) meeting where the Federal Reserve will decide on interest rates.
“The market is avoiding risk before the CPI and FOMC meeting tomorrow,” commented a Singapore-based investment firm. They added that the meeting will also reveal the Fed’s projections for interest rate adjustments throughout 2024.
Despite the short-term jitters, this firm remains optimistic about Bitcoin’s long-term prospects. They see potential buying opportunities and point to positive events on the horizon, such as the launch of a spot Ethereum ETF and potential crypto-friendly policies from political candidates.
Investors should also be aware of a potential market reaction on Friday, when Treasury Secretary Janet Yellen delivers a speech. Her comments could influence riskier assets like Bitcoin.
