- The BTC and ETH ETFs lost over $1 billion in a week – the largest outflow in three months.
- New altcoin ETFs, such as SOL, LTC and HBAR, are now apparently attracting institutional capital.
In 2024, the Bitcoin and Ethereum ETFs came onto the market. Institutional investor appetite was high and as a result ETFs had a record-breaking start. Now the tide has changed and things are heading downwards at a rapid pace – and institutional interest is following.
In recent weeks, there have been signs in the US crypto ETF market that investors are repositioning themselves. In particular, the tracking platform Sosovlaue revealed that a massive wave of capital flight has swept across the above-mentioned ETFs.
It pushed combined outflows for the two top ETFs to over $1 billion in a single week.
Bitcoin is leading the momentous downturn
According to Sosovalue, most of the selling pressure came from the Bitcoin sector. The tracking site has data for the week until the beginning of November recordedwhich show that US Bitcoin ETFs lost almost $800 million net.
Historically, the Grayscale Bitcoin Trust has been the primary source of outflows due to redemptions and arbitrage. Now sales were diversifying, and even the most successful newly launched funds were experiencing significant daily net outflows.
ETF leader BlackRock’s IBIT saw outflows of nearly $150 million on Oct. 31, and Fidelity’s FBTC also contributed to the negative tally, suggesting institutional market participants are taking profits and de-risking across the board.
Ethereum is also losing significantly
While Bitcoin led the decline, wore Ethereum ETFs contributed to the overall damage with net outflows in the hundreds of millions. In the previous week, Ethereum ETFs recorded net outflows of around $244 million.
The sales mainly affected the largest issuers. BlackRock’s ETHA and Fidelity’s FETH saw significant daily selling pressure amid institutional capital withdrawals.
Market observers suspect that these aggressive outflows are a typical reaction to the market-wide price correction after an extended rally. After months of price gains, now is the time to take profits.
As of the editorial deadline, the BTC price is available at $102,553.10 after entering the last 24 hours fell by 1.33%.
ETH will traded at $3,335.37, down 4.94% since yesterday corresponds.
Analysts are divided over where this capital will go, with some suggesting some will go to newer crypto ETFs. On the other hand, some analysts see a clear bear market approaching – how long it will last is uncertain.
Rise of Altcoin ETFs
As CNF reported, began last month the first single asset ETFs for Solana, Litecoin and Ivy trade in the USA. But the timing came as a surprise. The introduction der Single-Spot-ETFs in the midst of the US government shutdown, no one expected.
The SEC had previously streamlined general approval standards for crypto ETFs, but the shutdown left there without a full team within the agency that could have issued final, specific approvals. The issuers took a calculated risk and took advantage of an SEC rule that allows filings to automatically take effect after 20 days under certain conditions.
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