Recent volatility in Bitcoin prices in Asia has been closely tied to automated trading algorithms that track U.S. ETF liquidity.
Investors in Asia are facing turbulent times as automated trading bots react to data flows from spot Bitcoin exchange-traded funds (ETFs).
A report from Bloomberg suggests that these automated trading bots may be causing significant market volatility.
Bitcoin volatility in Asian trading markets
Shiliang Tang, president of Arbelos Markets, acknowledged the role played by these automated bots, saying: “From an algorithmic trading perspective, bots can automatically scrape and trade based on this data; that seems to be the case now.”
Information about the daily demand levels for these spot Bitcoin ETFs spread throughout the cryptocurrency market after U.S. stock market trading concluded during the Asian session. On April 2, during the Asian trading session, Bitcoin experienced a sharp drop that coincided with reports that investors were withdrawing funds from these ETFs.
According to Coingecko, the price of Bitcoin fell to $64,650 on April 2, losing about 6% in a single day. The drop triggered a surge in volatility across the cryptocurrency market. As of this writing, the price of Bitcoin is around $66,300.
The U.S. Securities and Exchange Commission (SEC) approved multiple spot Bitcoin ETF applications in early January, bringing about $12 billion in net inflows to the market. The peak of ETF inflows coincided with Bitcoin's all-time high of $73,737 in mid-March. However, a period of capital outflows followed, causing BTC to fall nearly 10% from its peak.
Spot Bitcoin ETF Outflows and Bitcoin Retracement
On Monday, April 1, spot Bitcoin ETF liquidity returned to negative territory again, Grayscale once again experienced large outflows, and Ark 21Shares also experienced smaller outflows. According to data from Farside Investors, the total outflow of these 11 spot-based investment products reached $85.7 million, equivalent to 1,200 BTC.
Bloomberg ETF analyst James Seyffart expressed surprise at the development, saying, "It's higher than I expected, to be honest," before further noting, "I think that's going to slow down a little bit now."
Galaxy Digital CEO Michael Novogratz predicted the possibility of corrections and consolidation in the market in early March, before Bitcoin soared to new highs.
Despite the overheated market, Novogratz remains optimistic about the future. He anticipates the possibility of the U.S. Securities and Exchange Commission approving a spot Ethereum ETF later this year. #比特币 #ETF交易机器人