Due to the cryptocurrency price crash, the Bitcoin ETF faced an outflow of $671.9 million, ending a 15-day streak of inflows.
Fidelity and Grayscale lead the ETF sell-off, causing the cryptocurrency market to evaporate $1 billion within 24 hours.
The U.S. Bitcoin [BTC] exchange-traded fund (ETF) saw a record single-day net outflow of $671.9 million on December 19.
This is the largest outflow since its launch, ending the BTC ETF's 15-day streak of inflows and the Ethereum [ETH] ETF's 18-day streak of inflows.
Data from Farside Investors shows that Fidelity's FBTC led the losses, with $208.5 million lost. Grayscale's GBTC and ARK Invest's ARKB followed closely, with outflows of $208.6 million and $108.4 million, respectively.
In contrast, BlackRock's IBIT ETF remained unchanged, with no reports of net outflows or inflows.
The market sell-off is accompanied by a drop in cryptocurrency prices.
The record outflow coincided with a significant drop in Bitcoin and Ethereum prices. Bitcoin fell 9.2% in the past 24 hours, closing at around $93,145.17, while Ethereum dropped 15.6%. During this period, the entire cryptocurrency market liquidated over $1 billion.
Data from Sosovalue shows that as of December 19, the total net assets of the Bitcoin ETF dropped from $121.7 billion two days ago to $109.7 billion, significantly shrinking and erasing most of the gains from early December.
This sell-off solidified Bitcoin's dominance in the cryptocurrency market, with Bitcoin's share currently at 57.4%. Despite recent turbulence, it has maintained its status as the leading asset.
Federal Reserve policy and broader economic issues.
The sharp decline in the cryptocurrency market is also related to broader macroeconomic concerns. Investors expect the Federal Reserve to cut rates by 0.25%, but Chairman Jerome Powell's remarks indicate a more cautious outlook.
Powell indicated that there may only be two interest rate cuts in 2025, suggesting that the pace of monetary easing will be below expectations.
The Federal Reserve's hawkish sentiment has also affected traditional markets, leading to a decline in the S&P 500 index. Analysts believe this uncertainty may further pressure the cryptocurrency market, as risk sentiment has shifted away from growth assets.
Market uncertainty has intensified, enhancing the 'buy the dip' sentiment.
Despite the market downturn, discussions about 'buying the dip' have surged on social media platforms. Data from Santiment shows that discussions about 'buying the dip' have reached their highest level in over eight months.
This sentiment peaked last in April when Bitcoin's price fell from $70,000 to $67,000, and then continued to decline.
Despite some traders remaining cautious, the resumed discussions indicate that some investors still hold an optimistic view of potential recovery opportunities in the cryptocurrency market.
