U.S. Spot Bitcoin ETFs Experience Slowdown Amidst Price Volatility

The world of cryptocurrency experienced a significant shift this week as U.S. spot bitcoin Exchange-Traded Funds (ETFs) saw a dramatic slowdown in net inflows, coinciding with a sharp decline in bitcoin’s price from its recent all-time high.

On Thursday, net inflows to these ETFs plummeted to their lowest monthly level, reaching just $132.5 million. This downturn was largely influenced by a substantial $257.1 million outflow from Grayscale’s GBTC fund, as reported by BitMEX Research. Since the inception of spot bitcoin ETF trading on January 11, total net inflows have accumulated to nearly $12 billion, equivalent to over 211,000 BTC, despite a 4.47% decrease in bitcoin’s value to $68,632.34.

Source: The Block

BlackRock’s IBIT ETF continued to lead the pack with an addition of $345.4 million in inflows. VanEck’s HODL ETF followed, with $13.8 million, benefiting from a temporary fee reduction. In a surprising turn, Fidelity’s FBTC ETF, which typically ranks second, fell to third place with $13.7 million in inflows, marking its lowest daily intake since launch.

Despite the slowdown, interest in spot bitcoin ETFs remains robust. Cetera Financial Group has recently approved the use of several ETFs, including BlackRock’s IBIT and Fidelity’s FBTC, for its network of financial professionals. Matt Fries, Cetera’s Head of Investment Products and Partner Solutions, emphasized the firm’s cautious yet proactive approach to incorporating bitcoin ETFs into client portfolios.

The ETF Store President Nate Geraci noted the growing trend of financial advisory firms leveraging bitcoin ETFs as a competitive edge, stating, “Things are getting wild.”

Thursday also witnessed the third-largest trading volume day for U.S. spot bitcoin ETFs, totaling $7.98 billion. This surge in activity occurred as bitcoin prices soared to new heights before experiencing a sharp correction. The record for daily trading volume remains at $9.9 billion, set on March 5, coinciding with bitcoin surpassing its previous all-time high of $69,000.

Leading the trading volume was BlackRock’s IBIT ETF, with $3.92 billion, marking its second-largest trading day. Grayscale’s GBTC and Fidelity’s FBTC also saw significant trading volumes of $1.96 billion and $1.21 billion, respectively.

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