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$500,000,000 Bitcoin ETF Outflows: Analysts Speak About 'Worst Day by Far'

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Thu, 2/05/2024 - 14:51
$500,000,000 Bitcoin ETF Outflows: Analysts Speak About 'Worst Day by Far'
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While the Bitcoin (BTC) price plummeted below two-month lows, the segment of spot Bitcoin ETFs is captured by panic. Top analysts are not sure that this panic-selling is rational.

"Worst day by far for BTC ETFs": Over $500 million erased from spot Bitcoin ETFs

Qiao Wang, a seasoned cryptocurrency investor and cofounder of Messari, calls the May 1 session the "worst day by far" for exchange-traded funds based on spot Bitcoin (BTC). During this dramatic session, the net volume of funds in BTC ETFs lost $500 million.

Fidelity Investments’ Fidelity Wise Origin Bitcoin Fund (FBTC) is responsible for the largest part of this flush being down by $191 million, while Grayscale's and ARK's products combined cover over 50% of half-billion losses.

Analyzing the moves made by spot Bitcoin ETFs holders, Qiao Wang agreed with his colleague Jim Bianco. Bianco indicated the large percentage of "paper hands" among the first generation of Bitcoin spot ETF holders:

Jim Bianco was right that ETF holders were paperhands, FOMOing on the way up jeering on the way down.

The segment of Bitcoin ETFs also witnessed three painful trading days on April 24, 25 and 30. The May 1 session, with its sad record, is the sixth "red" day for Bitcoin ETFs in a row.

Related

As covered by U.Today previously, spot Bitcoin ETFs launched in Hong Kong. The first day of trading ended with a mediocre AUM of $140 million and a trading volume of $12.1 million in equivalent.

Diamond-hand institutions are yet to come, analyst says

However, Mr. Wang is moderately optimistic about the next generations of Bitcoin Spot ETFs purchasers. The scene could see more and more diamond hand institutions coming. 

Heavyweight asset managers just "need time to get comfortable," the expert concluded.

Following the Bitcoin (BTC) price drop below $57,000, almost $600 million in liquidated long positions were registered over the last two days, CoinGlass data shows.

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