The recent drop in Bitcoin’s price might have raised concerns among those who anticipated a surge following the 4th Bitcoin halving.
Since the halving on April 20 2024, Bitcoin’s price has seen a significant decrease (down 7.5%). Around the halving date, Bitcoin was trading at approximately $64,000. Following the halving, there was a brief rally, with Bitcoin reaching above $67,000 on April 22 2024.
BITCOIN | #Bitcoin Completes its 4th Halving, Miner Rewards Slashed from 6.25 BTC to 3.125 BTC
Despite this reduction, miners still earn transaction fees for each block they mine as usual.https://t.co/l6WX2PYd15 pic.twitter.com/JxhoBkRXYp
— BitKE (@BitcoinKE) April 20, 2024
However, there was a gradual decline, dropping below $57,000 by May 1 2024, as per CoinGecko data.
At the time of writing, Bitcoin is trading at $59,190, down around 8% over the past week and 10.7% over the past 30 days.
The BTC decline coincides with lower enthusiasm for Spot Bitcoin exchange-traded funds (ETFs) which saw record outflows in the last week. ETFs in the U.S. experienced a net outflow of $34.4 million on May 2 2024, which was nonetheless a slowdown compared to the previous day’s record outflows.
MILESTONE | ‘We Do not Approve Nor Endorse Bitcoin,’ Says United States SEC as it Approves 11 Spot #Bitcoin ETFs
This development represents a historic milestone in the integration of Bitcoin into traditional financial markets.
Below are the 11 approved products.… pic.twitter.com/Zn41cG9Ji0
— BitKE (@BitcoinKE) January 11, 2024
Grayscale’s GBTC, which has been consistently seeing outflows, was the sole ETF to witness a net decrease in funds amounting to $55 million, as reported by SoSoValue data.
Ark Invest’s ARKB took the lead in daily net inflows, gaining $13 million.
Meanwhile, spot Bitcoin ETFs from Franklin Templeton, Valkyrie, Invesco, and Galaxy Digital recorded smaller net inflows, accumulating a combined total of $6 million.
BlackRock and Fidelity’s bitcoin funds, which hold the second and third positions in terms of total net assets, both registered no flows on that day.
Grayscale was the only ETF with net outflows on May 2 2024. However, the $55 million was sufficient to drag the market to a net outflow of $34.36 million.
The previous day [May 1 2024] had seen a record amount of money ($563.7 million) leaving Bitcoin ETFs, the highest ever recorded in a single day. Fidelity’s FBTC fund, which just started experiencing investor withdrawals the previous week, saw the most significant outflow at $191 million, exceeding that of Grayscale’s GBTC.
It was also the first time BlackRock’s IBIT fund had a net daily outflow on May 1 2024.
According to crypto analytics firm, Kaiko, Spot Bitcoin ETFs have the potential to ‘amplify market downturns,’ the firm said in a report.
“If there is an event that triggers large outflows, ETF issuers will need to liquidate their holdings, which could weaken values in crypto markets,” it stated.
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