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After months of continuous inflows, the surge of cash pouring into Bitcoin exchange-traded funds (ETFs) has come to a halt. According to data from London-based investment firm Farside Investors, investors withdrew nearly $218 million from these products yesterday.
This significant cash outflow coincides with a crucial federal economic report indicating that the American economy experienced slower growth than anticipated in the first quarter. As a result, it is unlikely that the Federal Reserve will lower interest rates in the near future, following their recent increase to combat inflation. High-interest rates do not bode well for risk-on assets like Bitcoin, as investors would rather place their funds in high-yield and stable investment opportunities.
In January, the Securities and Exchange Commission approved 11 Bitcoin ETFs, allowing investors to gain exposure to the cryptocurrency by purchasing shares that track Bitcoin's price through brokerage accounts. These ETFs have garnered immense popularity, with substantial amounts of money flowing into the products shortly after their launch.
However, after a continuous inflow period lasting 71 days, no new funds entered IBIT yesterday. Additionally, Grayscale's ETF experienced a loss of $139.3 million, while Fidelity's fund (FBTC) saw an outflow of $23 million, marking the first decline in assets since its launch.
Bitcoin (BTC) currently stands at $62,313, reflecting a 2.62% decline over the past 24 hours. The leading cryptocurrency is down 5.27% in the past week and is down 15.16% from the all-time high of $73,750 reached on March 14, 2024.