In a significant turn of events for the Bitcoin market, BlackRock’s Bitcoin ETF, known as IBIT, has seen a notable shift in trading patterns. After an impressive streak of 71 consecutive days of inflows, IBIT experienced zero inflows during Wednesday’s trading session, marking the first time in nearly three months.
IBIT had been leading the pack among Bitcoin ETFs, consistently topping the charts in terms of inflows and trading volume. However, this sudden halt in inflows suggests a potential turning point for the fund, although it falls just short of breaking the record for consecutive inflow days.
Eric Balchunas, an ETF expert at Bloomberg, emphasized the significance of IBIT’s 71-day streak, noting its remarkable performance since its launch. He compared it to the initial launch phase of the popular gold ETF, GLD, which saw a three-day streak of inflows.
However, BlackRock wasn’t alone in experiencing zero inflows on Wednesday; eight other Bitcoin ETF issuers also reported the same. Fidelity and Cathy Wood’s Ark Invest were among the few exceptions, recording inflows of $5.6 million and $4.2 million, respectively.
Meanwhile, Grayscale, a major BTC holder, continued to witness outflows, with a staggering $130 million outflow on Wednesday alone. This trend has put downward pressure on Bitcoin’s price, which has declined by 4.2% in the past 24 hours, currently trading at $62,990.
The decline in demand for Bitcoin is further evidenced by the negative funding rate observed since April 19, the first time since October 2023. This indicates a reduction in demand following the launch of several US spot Bitcoin ETFs on March 15, when Bitcoin reached record highs of $73,700.
Julio Moreno, Head of Research at CryptoQuant, highlighted that this trend reduces traders’ willingness to enter new long positions. Analyst Vetle Lunde from K33 Research noted the unusual 11-day streak of neutral-to-below-neutral funding rates, suggesting a potential further price consolidation in the market.
Furthermore, open interest in the CME Group’s Bitcoin futures market has decreased by 18% from its record high, reflecting a wavering interest among US institutions in cryptocurrency-related exposure and hedging.
As the cryptocurrency market awaits new catalysts, all eyes are now on Hong Kong, where a new set of spot Bitcoin ETFs is set to debut. Observers are keen to see if these ETFs can generate even a fraction of the demand seen by their US counterparts.
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