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On November 14, spot Bitcoin exchange-traded funds (ETFs) experienced a significant turnaround, registering a combined net outflow of $400.7 million. This sudden reversal interrupted a six-day streak of inflows, which had been buoyed by a bullish rally in the cryptocurrency market, following Donald Trump’s presidential election victory on November 5.
Impact of Market Shifts on Bitcoin ETFs
Data from SoSo Value indicates that Fidelity’s Bitcoin ETF was the hardest hit, with net withdrawals totaling $179.2 million. Other notable outflows included $161.7 million from the ARK and 21Shares joint ETF, alongside $113.9 million from Bitwise’s fund. Grayscale’s ETF products collectively saw an outflow of $74.9 million.
In contrast, BlackRock’s iShares Bitcoin Trust ETF (IBIT) managed to secure $126.5 million in net inflows, while the VanEck Bitcoin ETF (HODL) experienced a moderate inflow of $2.5 million. These outflows coincided with a post-election rally that increased Bitcoin’s price by approximately 30%, which was fueled by market optimism regarding Trump’s pro-crypto policies and his economic growth proposals.
Market Reactions and Bitcoin Price Fluctuations
Following the election-induced rally, which led to record inflows of $1.37 billion into Bitcoin ETFs on November 7, Bitcoin’s price saw a slight decrease. After reaching a peak of nearly $93,500 earlier in the week, it traded at $88,200, reflecting a 2% drop over the past 24 hours. Alongside Bitcoin, Ethereum ETFs also faced a collective $3.2 million net outflow on the same day, marking their first outflow since November 4 and halting a previous inflow streak of nearly $800 million.
Ethereum’s price mirrored this downturn, dropping nearly 5% to below $3,100. Grayscale’s Ethereum ETF bore the largest outflow at $21.9 million, contrasting with inflows of $18.9 million into BlackRock’s iShares Ethereum Trust ETF and $900,000 into Invesco’s ETH fund.
Continued Investor Interest in Digital Assets
Despite the recent outflows, last week proved fruitful for digital asset investment products, attracting a substantial $1.98 billion and marking the fifth consecutive week of inflows. This surge raised the year-to-date total to a record $31.3 billion, as reported by CoinShares. Overall, the global assets under management in the crypto sector have climbed to a historic peak of $116 billion, with Bitcoin leading the way at $1.8 billion in inflows. This activity has been encouraged by a favorable macroeconomic backdrop and recent shifts in U.S. politics.
Record Valuation for the Cryptocurrency Market
The global cryptocurrency market now boasts a record valuation of $3.2 trillion, a milestone driven largely by Trump’s election as U.S. president and heightened expectations for more favorable regulatory environments. Bitcoin achieved a new all-time high of $93,480, effectively doubling its value this year and increasing by 30% since the U.S. election. This positive sentiment extends to other cryptocurrencies as well, with significant gains observed in assets such as Ether and Dogecoin.
The renewed interest in the crypto market is attributed to the election of pro-crypto lawmakers and growing investments from major financial institutions via crypto ETFs. However, some analysts caution that Bitcoin may encounter short-term corrections. Ruslan Lienkha, Chief of Markets at YouHodler, predicts that Bitcoin could dip to the $75,000–$80,000 range before resuming its upward movement, suggesting that while the outlook remains optimistic, volatility may still be on the horizon.
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