On Monday, spot Bitcoin exchange-traded funds (ETFs) recorded their second-largest single-day net outflows since their launch in January. Crypto-based investment products experienced their second straight red day before the US elections, ending a seven-day positive streak.
Bitcoin ETFs Record Massive Outflow Day
US-listed spot Bitcoin (BTC) ETFs started the month on a negative note after two days of outflows. The investment products carried out notable for most of October, with four consecutive green weeks and twice the $2 billion mark.
Last week Bitcoin ETF included $2.2 billion in inflows, leading crypto investment products’ positive performance for the fourth week in a row. However, the funds saw a significant decline in net inflows from October 30 to October 31 as Bitcoin’s price struggled, dropping from $893.3 million in inflows to just $32.3 million.
On Friday, BTC ETFs experienced their first red day since October 22, ending their seven-day streak with outflows of $54.9 million. The negative sentiment continued early this week due to Bitcoin-based investment products registered the second-largest net outflow in a single day since its launch in January.
The funds had their biggest over-performing day on May 2, with outflows of $563 million. Meanwhile, Bitcoin ETFs saw outflows of $541.1 million this Monday. Bitwise’s BITB, AKR Invest’s ARKB and Grayscale’s Mini Trust (BTC) reportedly had record outflow days on November 4.
BTC ETFs see $541 million in outflows on Nov. 4. Source: Farside Investors
According to facts from Farside Investors, BITB and BTC saw $79.8 million and $89.5 million in outflows, respectively, while ARB recorded $138.3 million in negative net flows. Still, Fidelity’s FBTC led yesterday’s losses with outflows of $169.6 million, the second worst performing day.
BlackRock’s IBIT was the only BTC ETF to see positive net flows yesterday, with inflows of $38.4 million.
BTC ETFs continue to thrive
The massive outflow from Bitcoin ETFs happened just one day before the US elections. Experts agreed that market volatility and speculation surrounding the election outcome have affected investment products.
On a Tuesday interviewBloomberg analyst Eric Balchunas noted that the election is a major variable that could further impact Bitcoin price action and ETF performance.
Nevertheless, he believes that the net flow of the investment products, which amounts to $29 billion, has held “real thoughts” during this year’s “few downturns”, indicating that the performance of BTC ETFs will exceed all expectations for the first year even if the outcome of the elections has a negative impact on the market.
Balchunas called ETFs the “main vehicle” for traditional investors and a “disruptive powerhouse” that has “a lot of spiritual connection” to Bitcoin. For the analyst, these connections make Bitcoins ETFs a strong combination for the long term.
Meanwhile, Bitwise’s Chief Investment Officer (CIO), Matt Hougan, considers that “crypto has already won” regardless of the outcome of the election, but suggested that a Trump victory would be better for the market in the short term.
For Hougan, the only possible “bad” outcome would be a Democratic victory. However, he would remain optimistic about that scenario and buy the dip, as the past four years have taught him that “Washington can’t stop crypto.”
Ultimately, Bitwise’s CIO claimed that spot crypto-based ETFs will continue to see inflows and that the sector will continue to grow even if the market slows down.
Bitcoin is trading at $68,738 in the weekly chart. Source: BTCUSDT on TradingView
Featured image from Unsplash.com, chart from TradingView.com