For the first time since its launch, the Spot Bitcoin [BTC] ETF had a ten-day outflow streak.
Between May 15 and 29, Bitcoin ETFs sold $2.96 billion. BlackRock’s IBIT saw maximum outflows worth $2.11 billion in the past ten days, followed by Fidelity’s FBTC.
Meanwhile, many asset managers observed zero flows during these ten days. Interestingly, Morgan Stanley’s MSTB, which is relatively new to the market, saw outflows of $5.4 million during these ten days.
Is BlackRock Worried?
Many in the crypto world defended BlackRock as she did noted,
Guys, BlackRock doesn’t buy and sell $BTC. Those are her customers. And most of them are retail, just like the rest of us.
The user explained that the inflows and outflows during the first two years were always in line with the local tops or bottoms. This is because the retail industry is often emotional and buys at the top or sells at the bottom.
Have ETFs Dragged the BTC Price Down?
This happened when the price of Bitcoin was trading at $80,000 and then fell to $73,000.
However, after a slight increase, Bitcoin was trading at $73,807.36 at the time of writing. This indicated that the ETF withdrawals were the cause of the price drop.
Noteworthy is the Spot Ethereum [ETH] ETF had a three-week outflow streak.
Needless to say, the price of ETH also fell from $2,300 to $2,019.07 at the time of writing, reflecting ETF outflows.
Positive financing rate and more
At the same time, the OI-weighted funding rate for Bitcoin rose and was very positive, indicating that most traders were paying funding fees to short sellers and opening long positions.
Simply put, too many traders are optimistic when the price drops. Therefore, if buyers fail to intervene and push Bitcoin back above recent resistance levels, it often signals weakness and could result in a prolonged push.
A similar situation was recently reported by AMBCrypto, where Bitcoin ETFs experienced outflows along with rising funding rates and declining demand for spot.
Therefore, the conclusion was drawn that because it increases the probability of a squeeze, this can be a risky play for traders who take long positions.
Final summary
- BlackRock’s IBIT recorded the maximum outflow in these ten days of the outflow series.
- The withdrawals into Bitcoin ETFs also caused the price of Bitcoin to drop from $80,000 to $73,000.