BlackRock’s iShares Bitcoin Trust (IBIT) saw a historic day of outflows, with $37 million being withdrawn from the fund. This marks the first time that IBIT has experienced such a significant outflow. Preliminary data from Farside Investors reveals that other Bitcoin exchange-traded funds (ETFs) in the United States also recorded net outflows, totaling $526.8 million. However, the Hashdex Bitcoin ETF (DEFI) was the only one to report zero flows.
Among the ETFs, the Fidelity Wise Origin Bitcoin Fund (FBTC) had the largest outflow for the day, with $191.1 million being withdrawn. The Grayscale Bitcoin Trust (GBTC) followed closely behind with $167.4 million leaving the fund. The ARK 21Shares Bitcoin ETF and Franklin Bitcoin ETF also experienced outflows of $98.1 million and $13.4 million, respectively.
These outflows coincided with a 10.7% decrease in the price of Bitcoin over the past week. Nate Geraci, President of ETF Store, noted that the iShares Gold ETF and SPDR Gold ETFs have also experienced significant outflows this year, with $1 billion and $3 billion being withdrawn, respectively. Despite these outflows, gold has seen a 16% increase in value year-to-date.
ETF analyst James Seyffart emphasized that the Bitcoin ETFs are still functioning smoothly overall, as inflows and outflows are a normal occurrence in the life of an ETF. Meanwhile, Bitcoin has had its most challenging month since the collapse of FTX, with its value declining by nearly 16% in April.
The surge in demand driven by the anticipation of ETFs pushed Bitcoin to an all-time high of almost $74,000 in March. However, as optimism for Federal Reserve interest-rate cuts waned and risky investments lost their appeal, inflows to these products significantly decreased. This decline also affected crypto mining companies, with stocks of companies like Marathon Digital Holdings Inc., Riot Platforms Inc., Cleanspark Inc., and Cipher Mining Inc. experiencing drops ranging from 7.9% to 11%. Even MicroStrategy Inc., known for its corporate Bitcoin strategy, faced an 18% decrease after reporting a first-quarter loss of $53 million due to an impairment charge against the value of its Bitcoin holdings.
