Bitcoin spot exchange-traded funds (ETFs) experienced their first net outflows in nearly a month, with a total of 11 U.S. spot Bitcoin ETFs collectively witnessing a net outflow of $64.9 million after 19 consecutive days of net inflows. Among these, the Grayscale Bitcoin Trust (GBTC) had the largest net outflow of $39.5 million, followed closely by the Invesco Galaxy Bitcoin ETF (BTCO) with $20.5 million outflows. The Fidelity Wise Origin Bitcoin Fund (FBTC) also experienced a minor outflow of $3 million, while Bitwise and BlackRock’s ETFs saw modest inflows of $7.6 million and $6.3 million, respectively. The outflows coincided with a decline in the price of Bitcoin, dropping from above $70,000 to below $68,000 over 12 hours, resulting in $170 million in liquidations and putting downward pressure on the cryptocurrency market.
In the previous week, BTC spot ETFs had consistently observed strong inflows, with net inflows recorded on each trading day. The total net inflow for the week amounted to approximately $1.83 billion, reaching levels of demand not seen since early March. The cumulative net inflow since the inception of these ETFs has now reached a record high of about $15.7 billion. The integration of Bitcoin into traditional finance is expanding globally, with the recent launch of Australia’s first BTC spot ETF and the approval of Thailand’s inaugural BTC spot ETF by the Thailand Securities and Exchange Commission. Additionally, central banks, including the Bank of Canada and the European Central Bank, have cut interest rates by 25 basis points, indicating governments’ optimistic expectations about managing inflation while implementing less restrictive monetary policies.
Less restrictive monetary policies are generally favorable for risk-on assets such as stocks and digital assets like Bitcoin, particularly when rate cuts do not signal an imminent recession. Despite inflation levels surpassing the central banks’ 2% annual target, the rate cuts suggest confidence in their ability to control and maintain inflation near desired levels with more expansionary monetary policies. The U.S. Bureau of Labor Statistics is set to release May figures for its inflation-measuring Consumer Price Index (CPI) on June 11, with analysts forecasting inflation to rise 0.1% after a 0.5% increase in April, bringing the year-on-year figure to 3.4%. Core inflation is also forecasted to rise 0.3% in May, the same as April. The Fed’s monetary policy will be decided at a two-day Federal Open Market Committee (FOMC) meeting starting the same day.
Overall, Bitcoin spot ETFs experienced their first net outflows in nearly a month, with several U.S. spot Bitcoin ETFs witnessing a total net outflow of $64.9 million after a streak of 19 consecutive days of net inflows. The outflows coincided with a decline in the price of Bitcoin, dropping from above $70,000 to below $68,000 over 12 hours, resulting in liquidations and downward pressure on the cryptocurrency market. On the macroeconomic front, central banks, including the Bank of Canada and the European Central Bank, have cut interest rates by 25 basis points despite inflation levels surpassing the 2% annual target, indicating their confidence in managing inflation with less restrictive monetary policies. The integration of Bitcoin into traditional finance continues to expand globally, with the recent launch of Australia’s first BTC spot ETF and the approval of Thailand’s inaugural BTC spot ETF, indicating increasing acceptance and adoption of the cryptocurrency in mainstream financial markets.
