Investors withdrew large sums from US-listed spot bitcoin (BTC) and ether (ETH) exchange-traded funds (ETFs) on Wednesday as macroeconomic uncertainties cast a shadow over the prospects of price of cryptocurrencies.
Eleven bitcoin ETFs recorded a combined net outflow of $582 million, marking the second-largest total since the alternative investment vehicles began trading a year ago, according to data from SoSoValue. The large outflow was shy of the record withdrawal of $680 million on December 19.
Fidelity’s FBTC led the outflows, losing a record $258 million, with BlackRock’s IBIT bleeding $124 million.
Ether ETFs bled $159.3 million, the biggest tally since July 26, when these public funds processed withdrawals totaling $162 million.
These large inflows coincided with renewed US inflation fears, which fueled the stimulus bond market volatilitysending assets with lower risk. Over the past three days, the price of bitcoin has fallen nearly 8.5%, marking another bull failure to establish a foothold above the $100,000 mark.
Minutes from the Federal Reserve’s Dec. 18 meeting were released Wednesday showed up Officials believe the central bank is nearing the point of calling for a slowdown in the pace of policy easing. The notes also expressed concerns about the inflationary impact of incoming President Donald Trump’s policies.
However, some analysts remain optimistic, expecting another increase following Friday’s nonfarm payrolls report.
“Friday’s US employment report is highly anticipated by investors, as it will provide critical insights into the health of the US economy. We expect limited volatility heading into the weekend and recommend maintaining a heavy exposure to digital assets, with a preference for Bitcoin over Ethereum,” Valentin Fournier, analyst at BRN said in an email.
