The U.S. spot Bitcoin exchange-traded funds (ETFs) witnessed $43.97 million in net outflows on Wednesday, breaking a two-day streak of positive inflows. The largest contributor to the outflow was ARKB, the Bitcoin ETF managed by Ark Invest and 21Shares, which saw $54.03 million in net withdrawals, as reported by SoSoValue.
Grayscale’s GBTC also experienced significant losses, with $4.59 million in net outflows, while its Bitcoin Mini Trust faced smaller outflows of $511,230.
On the other hand, Fidelity’s FBTC stood out with $12.57 million in net inflows, leading the pack for the day. Invesco’s BTCO also saw positive movement, attracting $2.59 million. However, several ETFs, including BlackRock’s IBIT, reported zero activity, with IBIT notably not receiving any net inflows since August 26.
Despite the outflows, Bitcoin ETF trading volumes surged, with $1.27 billion in activity on Tuesday—an increase from the $712.25 million recorded the day before. Since their launch in January, Bitcoin ETFs have collectively amassed $17 billion in net inflows.
Meanwhile, U.S. spot Ether ETFs also saw net outflows, totaling $542,870, with seven of the nine Ether funds showing no daily activity. VanEck’s ETHV posted the largest outflows at $1.71 million, while Fidelity’s FETH registered inflows of $1.17 million. Trading volume for Ether ETFs rose to $126.22 million on Wednesday, up from $102.87 million the previous day, though total net outflows now stand at $562.06 million.
In the broader market, Bitcoin’s price climbed 3.37% to $58,318 in the past 24 hours, while Ether gained 1.78%, reaching $2,373.
Analysts attribute the ETF outflows to strong U.S. economic data, including the latest Consumer Price Index report, which showed a 0.2% rise in August. Investors are also eyeing the upcoming Federal Open Market Committee (FOMC) meeting, where a 25-basis point rate cut is anticipated.
Impact of Potential Federal Reserve Rate Cuts on Crypto Market
A potential rate cut by the Federal Reserve, whether 25 or 50 basis points, is expected to influence the crypto market positively, according to Ryan Lee, Chief Analyst at Bitget Research.
Lee noted that a 25-basis point cut would signal moderate economic concerns, potentially driving gradual capital inflows into cryptocurrencies as investors seek higher returns outside of traditional markets. This could lead to a moderate market rebound with limited volatility.
On the other hand, a 50-basis point cut would indicate more severe economic worries, likely prompting a more substantial influx of capital into crypto, especially Bitcoin. However, this scenario could result in greater market volatility.
In the short term, Lee warned of sharp price fluctuations as investor sentiment shifts. However, in the long run, either rate cut would support expectations of continued Federal Reserve easing, bolstering demand for cryptocurrencies.
