Bitcoin spot exchange-traded funds (ETFs) in the United States experienced a consecutive three-day period of net outflows, with a combined total of $261.5 million exiting the ten approved funds on March 20. According to data from Farside Investors, this translates to a cumulative net outflow of $742 million over the mentioned timeframe. Specifically, on March 18 and 19, the net outflows were $154.3 million and $326.2 million, respectively.
GBTC Outflows Persist
The primary contributor to the outflows was the Grayscale Bitcoin Trust (GBTC), which witnessed a substantial outflow of $386.6 million. Additionally, the Invesco Galaxy Bitcoin ETF (BTCO) experienced $10.2 million exiting the fund. These outflows overshadowed the minor inflows from the other eight approved ETFs.
On the other hand, the BlackRock iShares Bitcoin Trust (IBIT) recorded its second-lowest net inflow day at $49.3 million, only $4 million higher than its daily low on February 6. Similarly, the Fidelity Wise Origin Bitcoin Fund (FBTC) saw a relatively modest inflow day at $12.9 million.
This represents the second-highest net outflow day for the ten ETFs, with the highest being the $326.2 million outflow on March 19.
In contrast, Bitcoin experienced a gain of over 3% during U.S. trading hours and has seen a 7.5% increase over the past 24 hours, reaching a trading price of $66,838.
Over the previous week, BTC has declined from its record high on March 14 as the countdown to the blockchain’s halving, where mining rewards are halved, enters its final month.
Historical data from CoinMarketCap indicates that Bitcoin typically undergoes a decline leading up to the halving, and this pattern appears to be repeating as the event approaches its final 30 days.
Outlook for Bitcoin Remains Optimistic
Despite the ongoing downturn, optimism for Bitcoin persists among numerous investors and market analysts.
The approval of spot Bitcoin ETFs in January has ignited a fresh wave of investor interest in cryptocurrencies.
This is evident from the record-breaking weekly inflows into digital asset investment products, totaling $2.9 billion last week alone. This surge has propelled year-to-date inflows to an impressive $13.2 billion, as per CoinShares data.
Furthermore, the imminent Bitcoin halving event scheduled for next month is expected to provide further support to the cryptocurrency’s value.
This event will reduce the number of new tokens released by half, effectively tightening the supply amidst escalating demand.
In response to soaring outflows reaching $12 billion, Grayscale has announced plans to gradually reduce fees on its flagship product. According to Grayscale CEO Michael Sonnenshein, the cryptocurrency fund manager foresees fee reductions for the Grayscale Bitcoin Trust ETF in the upcoming months as the crypto ETF market matures.
Previously, Grayscale had defended its above-average charges, citing that fees typically run higher for new products in their initial stages.
Since its transition into an ETF in early January, GBTC has encountered outflows surpassing $12 billion. Sonnenshein acknowledged the anticipated outflows as investors aimed to capitalize on profits, arbitragers exited the fund, and individuals unwound positions linked to bankruptcies and forced liquidations.
