BlackRock, a major player in the cryptocurrency market, recently made headlines for experiencing its largest outflows in months. The leading asset manager saw its Bitcoin exchange-traded fund, IBIT, record a significant outflow of $72.7 million on December 20, breaking its previous inflow streak.
According to data from Farside Investors, this outflow marked the largest in IBIT’s history since its launch in January of the same year. The day before, IBIT had zero flows, causing concern among investors about the future of the exchange-traded fund. Additionally, another ETF issuer, Fidelity Wise Origin Bitcoin Fund (FBTC), also saw a record outflow of $208.5 million on December 19, followed by a $71.9 million outflow on December 20.
IBIT and FBTC are among the top performing exchange-traded funds in the United States, ranking 1 and 2 respectively among the top 25 ETFs in terms of assets after just one month in the market. The US Spot Bitcoin ETF market experienced a record-high two consecutive days of outflows due to the significant outflows from BlackRock and Fidelity, totaling $671.9 million on December 19 and an additional $277 million on December 20.
The massive outflows from these two major ETF issuers raised concerns among crypto investors about the future outlook of ETFs in the coming months. However, analysts suggested that the situation should not come as a surprise, as both BlackRock and Fidelity had previously accounted for large inflows. Some investors worry that these recent developments could signal a decrease in institutional investors’ appetite for Bitcoin exposure.
Despite the concerns, market observers believe that the outflows may not be a lasting trend. After a brief dip to $92,710, Bitcoin has been showing signs of recovery and moving upwards again. However, Bitcoin’s market volume has seen a 52% decline to $59.50 billion, contrasting with the bullish run it experienced after the US election results. In November, Bitcoin reached an all-time high of $108,000 per coin, while the US spot Bitcoin ETF also benefited from the bull market with a record-high of $6.2 billion in net inflows.
As of the time of writing, Bitcoin is trading at $95,359 per coin, down by 1.3% in the last 24 hours, with a total market capitalization of $1.9 trillion. The fluctuations in the cryptocurrency market continue to attract attention from investors and analysts alike, as they navigate the evolving landscape of digital assets.
In conclusion, BlackRock and Fidelity’s recent outflows have sparked concerns among investors, but market observers remain optimistic about the resilience of Bitcoin and the broader cryptocurrency market. The future of ETFs and institutional investment in cryptocurrencies remains uncertain, but the overarching trend of digital assets continues to evolve and attract interest from various stakeholders in the financial sector.
