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American BTC ETFs (spot) are recording the largest daily outflow of funds in history

American BTC ETFs (spot) are recording the largest daily outflow of funds in history

created Simon peters7 May 2024

It's been a rough week for cryptocurrencies as falling prices wiped out more than $235 billion from total market capitalization. Bitcoin reached $56 and ended April down 500%, making it the worst month since FTX went bankrupt in November 18.

Prices appeared to continue falling as the week progressed. Factors such as the inflow of spot ETFs and circulating supply held by investors, which helped drive prices to a record high of $73 at the beginning of the year, have recently turned negative and put pressure on the price.

However, Friday's employment data, which (apart from agriculture) turned out to be lower than expected and a higher unemployment rate in the US, caused an increase in the price of bitcoin and other cryptocurrencies. This happened because increased optimism about Federal Reserve interest rate cuts also caused bond yields and the U.S. dollar to decline.

Time will tell whether Friday's momentum carries over to this week and pushes the price above the $66 level, or if the resurgence will be short-lived and prices will return to $800 and below.

Block announces dollar-cost averaging bitcoin purchasing strategy

Publicly traded payments company Block (formerly Square) announced alongside its Q2024 XNUMX corporate earnings results that it will be adding more bitcoin to its balance sheet in the future through its dollar cost averaging (DCA) strategy.

As described in the Blueprint For Corporate Balance Sheets, each month Block will allocate 10 percent. of your monthly gross profit from bitcoin products into purchasing bitcoins for investment purposes.

Block already has significant bitcoin holdings, having purchased 2020 of them in October 4 and another 709 in February 3. At current market prices, its bitcoin holdings are worth approximately $318 billion.

US bitcoin spot ETFs record the largest daily outflow in history

As reported by The Block, last Wednesday, U.S. spot bitcoin ETFs experienced their worst-ever net outflows totaling -$563 million.

Fidelity's FBTC led outflows of -$191 million, followed by Grayscale's GBTC (-$167,4 million) and Ark's ARKB (-$98,1 million). Additionally, the Blackrock IBIT bitcoin spot ETF had its first-ever day of net outflows of -$36,9 million.

As more institutions gain exposure to bitcoin through spot ETFs, reactions to economic data and changes in U.S. monetary policy may have a greater impact on the price of bitcoin in the future.

U.S. Treasury yields continue to rise, and a strengthening U.S. dollar in the wake of higher interest rates could result in further outflows from cash ETFs into bitcoin.

Spot ETFs for bitcoin and ethereum are listed on the Hong Kong stock exchange

Recently approved bitcoin and ethereum ETF applications from Harvest Global Investments, China Asset Management and Bosera Asset Management launched on the Hong Kong Stock Exchange last Tuesday.

Despite the excitement surrounding the listings, the total trading volume on the launch day of these spot ETFs was only HK$87,58 million ($12 million), significantly lower than the US bitcoin spot ETFs, which recorded a trading volume of $4,6 billion.

While the assets under management and trading volumes of these Hong Kong-based spot ETFs are significantly smaller compared to their US counterparts, more potential investors and new integrations into the Asian financial system could still bode well for bitcoin prices and Ethereum in the long run.

The approval of bitcoin and ethereum spot ETFs in Hong Kong could also pave the way for other neighboring countries and jurisdictions to follow suit.

Securitize Announces $47 Million Financing Round Led by BlackRock

Last week, Securitize – a leader in real-world asset tokenization – announced the completion of a $47 million funding round led by BlackRock. The strategic investment also includes financing from Hamilton Lane, ParaFi Capital and Tradeweb Markets, according to the press release. As part of the investment, BlackRock's Global Head of Strategic Ecosystem Partnerships, Joseph Chalom, has been appointed to Securitize's board of directors.

Securitize recently gained notoriety after Blackrock launched a new fund called BUIDL (BlackRock USD Institutional Digital Liquidity Fund), tokenized on the Ethereum blockchain.

The new round of funding, along with Blackrock's continued commitment and collaboration with Securitize, further underscores the world's largest asset manager's support for real asset tokenization

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About the Author
Simon peters
eToro analyst. A graduate of the Faculty of Mechanical Engineering at Brunel University in London. He is CFA UK Level 4 certified in Investment Management.

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