The enormous spike in bitcoin’s value beyond $80,000 seems to be losing some of the steam that was supposed to fuel it. Eleven spot bitcoin ETFs launched in the United States have started to lose money after raising $3.29 billion from investors in March and April.
Wednesday saw investors withdraw $635 million from these funds, according to SoSoValue, the largest single-day net outflow since January 29. It wasn’t just one occurrence either. A week ago, total net inflows were $59.76 billion, but after losing $1.26 billion over the previous five trading days, that number decreased to $58.5 billion.
Fears of Inflation on the Rise
Bitcoin price rallies have ended. Prices have hit a ceiling at the 200-day simple moving average, which is just over $82,000, marking the end of the run that took them from $65,000 to over $80,000 since last Wednesday.
Although these macro events have received little attention from Wall Street’s Nasdaq and S&P 500 stock index, analysts are tying the 2% drop in bitcoin price to fresh inflation concerns in the US, which has caused the price to drop to $79,200..
The $635 million outflow is not something that bulls can easily ignore, especially in light of the strong inflows in March and April, which were anticipated to lead to more price gains, and the worsening macro picture caused by rising inflation in the US. Although it is more convoluted today than it was before, the link between bitcoin and ETF flows is still important to note.