Bitcoin ETFs Shed $649M in Day as Long BTC Holders ‘Limit Downside Potential’

Spot Bitcoin ETFs are doing well, losing $648.64 million on Monday following last week. $1 billion is outAccording to SoSoValue.

BlackRock’s IBIT led Monday’s outflow with $448 million. They were followed by ARK Invest with 21Shares’ $110 million and Fidelity’s $63 million in outflows.

Bitcoin fell 6.7% from $81,700 last Thursday to $76,201 for the week, according to CoinGecko data. It is down 0.7% in the last 24 hours and is currently trading at around $76,680.

Agne Linge, Advisor to the Board of the blockchain financial infrastructure firm Wefi, said Decrypt that the exit “is in line with the general market and reflects the strategy of risk reduction carried out by investment managers in view of geopolitical events,” amid the recent escalation of the US-Iran conflict.

Despite Linge’s comments on the political situation, Illia Otychenko, an analyst at CEX.IO, said the exit “was driven by the increase in US inflation last week, which changed the market’s expectations around the Federal Reserve’s policy, and expected a rise in prices this year.”

Get started Thousands of peopleprediction market for Decrypt‘s parent company Dastan, readers site only 2% chance for the Fed to cut rates by 25 bps in June, and a 4% chance among them cut trees by more than 25 bps before July.

Otychenko noted that the more dovish sentiment was also driven by “the growing concern that the US-Iran conflict could escalate again, and the ‘calm before the storm'” of Donald Trump.

Reflecting Bitcoin’s 6.7% decline last week and the ETF’s weekly outflows, investor sentiment on the Crypto Fear and Greed Index is. he has fallen to 25, indicating “Very Scared.”

Looking ahead

Despite the bearish sentiment, many structural factors can prevent others.

Vetle Lund, head of research at K33 Research, previously noted that the all-time favorite Stretch Strategy, STRC, could be. encouraging repeated monthly meetings about Bitcoin.

Although the demand of the Strategy may help to stop the outflow of the ETF partially or fully, it does not seem to be a sufficient factor alone to support the recovery of the price of Bitcoin, Otychenko said, mentioning the same events at the end of January and the beginning of February when the demand of the Strategy exceeded the outflow of the ETF, without having a significant impact on the price of Bitcoin.

Although Bitcoin’s open interest dropped from $29 billion to $26 billion in the past two weeks, according to CryptoQuant data, the metric remains elevated based on recent data, suggesting that investors will remain optimistic despite lower rates.

Bitcoin has rebounded after months of negative momentum, meaning investors are opening long positions despite the recent lows. $670 million in liquidations last week.

The most important thing is the long-term behavior of the operators, Otychenko said, meaning that these groups “have continued to collect BTC continuously for more months than MSTR, even though a growing part of their assets was lost.”

This is “reducing the potential of Bitcoin,” he said, suggesting that this was “a sign of long-term sentiment” despite the short-term volatility. This opinion is supported by Myriad users, who remain optimistic that the next move of Bitcoin will take $84,000, putting 77% chance for that outcome. However, recent developments have dampened their interest, with this number down from 89% last week.