Spot Bitcoin exchange-traded funds in the United States experienced their second straight day of net outflows as the broader crypto market sentiment has turned bearish.
Summary
- Spot Bitcoin ETFs have recorded their second consecutive day of outflows.
- Analysts remain largely bearish on Bitcoin and expect a potential drop to as low as $70k.
According to data from SoSoValue, the 12 US spot Bitcoin ETFs recorded $103.61 million in net outflows on Tuesday, Sep. 23, extending the outflow streak to two consecutive days that saw nearly $467 million exit the funds.
Fidelity’s FBTC led the majority of outflows on the day, with $75.56 million withdrawn by investors. ARK 21Shares’ ARKB and Bitwise’s BITB funds followed with outflows of $27.85 million and $12.76 million, respectively.
Invesco’s BTCO managed to offset part of these outflows as it drew in $10.02 million from investors, with BlackRock’s IBIT also contributing to the upside, albeit with more modest inflows of $2.5 million. The remaining seven BTC ETFs saw zero flows on the day.
Daily trading volume for the 12 BTC investment products stood at $3.16 billion on Tuesday, slightly dropping from the previous day.
However, it should be noted that despite the recent outflows from the BTC funds, the products still hold over $3 billion in net inflows in September, showing significantly better performance than August, when over $750 million was reportedly withdrawn by investors.
The recent outflows from the spot Bitcoin funds followed Bitcoin’s visit to multi-week lows after the crypto market saw one of the largest liquidation events this year. On Monday, the crypto market saw over $1.7 billion in total liquidations, with long liquidations making up the majority..
Bitcoin crumbled under the selling pressure and lost the $115,000 threshold, and has subsequently dropped as low as $111,369 in the subsequent trading session on Tuesday.
Much of this bearish momentum was fuelled by undercut hopes that the United States Federal Reserve would kick off a clear easing cycle, especially after it cut rates last week. However, the rate cut optimism quickly faded away after Fed policymakers adopted a hawkish stance, primarily by signaling fewer interest rate cuts in 2025 than previously expected.
Fed Chair Jerome Powell insisted that future cuts would be “data dependent,” which left traders without a clear timeline or conviction, and in turn, drained the market’s risk appetite.
“Outflows from Bitcoin ETFs this week were the result of last week’s Federal Reserve rate cut, which could be a harbinger of a coming recession. Risks of inflation and increasing unemployment remain, contributing to risk-off sentiment at institutions,” Kadan Stadelmann, Chief Technology Officer at Komodo, told crypto.news in a statement.
However, Stadelmann downplayed the broader implications, adding that the recent outflows are “profit-taking rather than a fundamental issue for the Bitcoin price,” implying that long-term investor conviction remains intact.
Bitcoin downside risks remain
For now, Bitcoin needs to hold ground above $110k to avoid further correction, according to TYMIO founder Georgii Verbitskii.
“Right now, the market looks weak, as BTC isn’t bouncing after the recent drop, if the slide continues, that’s a negative sign. However, if we see a slow move back toward $118K, that could be the point where long positions start to make sense, with a continuation of the broader uptrend possible into year-end.”
Georgii Verbitskii, founder of TYMIO.
Social media sentiment is mostly bearish at the moment, according to data shared by Santiment. Notably, bearish calls for a BTC drop toward the $70K–$100K range have dominated online discussions and significantly outweigh bullish predictions for a rally towards $130K–$160K.
At press time, Bitcoin (BTC) was trading at $112,639, down 0.3% over the past 24 hours.
Disclosure: This article does not represent investment advice. The content and materials featured on this page are for educational purposes only.
