Bitcoin ETFs have experienced a notable reversal of fortune, with nearly half a billion dollars flowing out of these investment vehicles over a three-day period. This shift breaks a nine-day streak of positive inflows, totaling approximately $2 billion, and raises concerns about renewed fear in the cryptocurrency market.
Fidelity's FBTC took the biggest hit, with outflows of $191 million. BlackRock's IBIT, the largest spot Bitcoin ETF, saw close to $167 million exit, while Ark Invest's ARKB experienced $73.3 million in withdrawals. The outflows occurred across the week, with Monday registering the highest single-day outflow of $263 million. Tuesday saw $89.7 million in outflows, followed by $137.6 million on Wednesday, coinciding with the Federal Reserve's latest policy announcement.
The Federal Reserve's decision to hold interest rates steady at 3.50%-3.75% appears to have contributed to the shift in sentiment. Bitcoin's price fell roughly 3% following the announcement, trading around $75,900. Some analysts believe that a smooth transition of Federal Reserve Chair, with Kevin Warsh potentially replacing Jerome Powell, is needed to avoid prolonged market uncertainty.
Despite the recent downturn, some traders remain optimistic, anticipating a potential recovery towards the $85,000-$88,000 range in May if macroeconomic conditions improve. However, continued ETF outflows could lead to a retest of the $74,000 support level. The coming weeks will be critical in determining whether the outflow trend reverses or deepens, potentially impacting Bitcoin's price trajectory in the near term.
