Bitcoin Spot ETFs See $52.8 Million in Outflows Following Fed’s 50 Basis Point Rate Cut

Bitcoin Spot ETFs See $52.8 Million in Outflows Following Fed’s 50 Basis Point Rate Cut

On Wednesday, U.S. spot Bitcoin exchange-traded funds (ETFs) experienced a net outflow of $52.83 million, halting a four-day streak of inflows that had collectively brought in over $500 million. The outflows followed the Federal Reserve’s announcement of a 50 basis point interest rate cut, sparking a mixed reaction in the crypto market.

The Ark Invest and 21Shares’ ARKB fund led the withdrawals with $43.41 million in outflows, as per data from SoSoValue. This reversal comes after a period of heightened interest in Bitcoin ETFs, showing the impact of macroeconomic shifts on digital assets.

Grayscale and Bitwise Also Report Outflows

Other Bitcoin ETFs also saw significant withdrawals. Grayscale’s Bitcoin Trust (GBTC) recorded a net outflow of $8.13 million, while Bitwise’s BITB saw a smaller outflow of $3.95 million. Despite these drops, Grayscale’s Bitcoin Mini Trust stood out as the only spot Bitcoin fund to report a net inflow, gaining $2.66 million.

Overall, the 12 Bitcoin ETFs managed to achieve a daily trade volume of $1.63 billion, with a cumulative net inflow of $17.44 billion. While outflows dominated the day, the market’s long-term accumulation remained substantial.

Ether ETFs Also See Withdrawals

Ether-based ETFs also experienced notable outflows, with $9.74 million leaving the market. Grayscale’s ETHE fund led the retreat, seeing $14.66 million in outflows. Meanwhile, BlackRock’s ETHA fund recorded a modest inflow of $4.92 million. Ether ETFs posted a daily trade volume of $221.88 million, up from $176.26 million the day before.

Since their launch in July, Ether ETFs have faced an uphill battle, accumulating a total net outflow of $615.58 million, underscoring the volatility and uncertainty in this segment of the crypto market.

Market Rebound After Fed’s Rate Cut

Despite ETF outflows, Bitcoin’s price surged by 3.03% over the past 24 hours, hitting $62,138, as investors reacted positively to the Fed’s interest rate cut. The Federal Open Market Committee’s decision to reduce rates by 50 basis points is seen as an effort to stimulate economic growth amid ongoing concerns about the broader economy.

Matt Mena, a Crypto Research Strategist at 21Shares, noted, “A 50 bps rate cut could suggest the economy is slowing, raising concerns for traditional and digital investors alike. However, historically, Bitcoin and other digital assets perform well in low-interest-rate environments.”

Mena added that this move could bring liquidity back into the market, sparking a risk-on sentiment and leading to a Bitcoin rally as investors pursue higher yields.

Broader Crypto Market Gains

In addition to Bitcoin’s rise, other cryptocurrencies also saw gains. Ether jumped 4.14% to reach $2,414.60, while Solana surged 6.21%, trading at $138.96, reflecting a broader recovery in risk assets as market optimism returned following the rate cut decision.

Overall, the crypto market remains responsive to macroeconomic shifts, with both traditional and digital investors recalibrating strategies in response to central bank policies.

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