Spot Bitcoin ETFs See $541 Million in Outflows, Second-Largest Since Launch

Highlights:

• Bitcoin ETFs saw a $541.1 million outflow, marking the second-largest drop.
• Fidelity’s Bitcoin fund experienced the largest withdrawals at $170 million on Monday.
• Analysts predict increased Bitcoin volatility as the presidential election approaches, potentially triggering sell-offs.

United States-based spot Bitcoin exchange-traded funds (ETFs) experienced a net outflow of $541.1 million on Monday, November 4. This marks the second-largest single-day outflow since their launch, according to Farside Investors. 

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The recent selloff was close to the record $563.7 million withdrawn on May 1. The Fidelity Wise Origin Bitcoin Fund (FBTC) saw the largest withdrawals, with $170 million on Monday, marking its second-largest daily outflow ever. ARK 21Shares Bitcoin ETF (ARKB) and Bitwise Bitcoin ETF (BITB) had their worst performances since launching, with outflows of $138.3 million and $80 million, respectively.

Grayscale’s two Bitcoin funds had a total of $153.2 million in outflows. The Grayscale Bitcoin Trust (GBTC) saw $63.7 million in outflows. This year, GBTC has only had a few net inflow days. The mini GBTC recorded $89.5 million in outflows. These outflows were the third and fifth largest for the day, respectively. Franklin Bitcoin ETF (EZBC), VanEck Bitcoin ETF (HODL), and Valkyrie Bitcoin Fund (BRRR) collectively recorded outflows exceeding $38 million.

In contrast, BlackRock iShares Bitcoin Trust (IBIT) saw about $38.4 million in net inflows. Meanwhile, WisdomTree Bitcoin Fund (BTCW) and Invesco Galaxy Bitcoin ETF (BTCO) recorded no inflows. The Bitcoin ETFs traded approximately $2.22 billion yesterday, down from $3.09 billion on Friday. Their total net inflow reached $23.68 billion.

Spot Bitcoin ETFs End Winning Streak Amid Market Volatility and Election Uncertainty

Spot Bitcoin ETFs ended their seven-day winning streak last Friday as Bitcoin fell below $70,000 after nearing its all-time high earlier in the week, according to CoinGecko. The record outflow comes after the ETFs saw $2.22 billion in inflows last week, marking one of their largest weekly net inflows.

Rachael Lucas, crypto analyst of BTCMarkets, said:

“After last week’s record-breaking inflows, some degree of rebalancing is expected, as investors take profits and adjust portfolios in anticipation of market volatility. The timing likely aligns with the upcoming U.S. election results as many market participants adopt a ‘wait and see’ stance amid heightened geopolitical and policy uncertainties.” 

James Butterfill, head of research at CoinShares, stated that inflows for most of the week were fueled by excitement over the possibility of a Republican victory. “As polls have turned, we saw minor outflows on Friday, highlighting how sensitive Bitcoin is to the US elections at present,” he added.

Market Awaits Presidential Election and Fed Decision

Everyone is focusing on today’s presidential election and the Fed’s policy decision on Wednesday. Crypto markets are preparing for more ups and downs. Analysts expect Bitcoin’s volatility to increase as the election nears. This could cause a “sell-the-news” reaction, like previous events, leading to significant price changes. Bitcoin is trading around $68,710, a 0.50% drop in the last 24 hours, according to CoinMarketCap. The total crypto market cap fell nearly 0.65%, now at $2.4 trillion.

Bitcoin has often increased in price after the US elections. Following the 2012, 2016, and 2020 elections, Bitcoin saw significant gains in the year after each. This trend indicates that Bitcoin may rally post-election, no matter the winner. However, short-term price movements could vary based on the election outcome.

On the crypto betting platform Polymarket, Trump’s chances of winning the presidency experienced a significant drop. His odds fell to a low of 53.8% on November 3, down from a peak of 67% on October 30. Currently, his odds are just above 61%. Analysts at Bernstein believe that if Trump wins, Bitcoin’s price could rise to $90,000. Conversely, if Harris wins, Bitcoin may drop to $50,000.

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