Bitcoin (BTC) recovers slightly on Wednesday, trading above $61,000, after Tuesday’s slump due to the escalating Israel-Iran conflicts. The decline, which led BTC to trade below $61,000, wiped out more than $500 million from the crypto market. US spot ETF data recorded outflows of over $240 million, the largest single-day decline in almost one month, signaling a decline in institutional demand.
Global equities and risk assets like Bitcoin experienced a setback on Tuesday as Iran launched missiles at Israel, giving rise to Fear, Uncertainty and Doubt (FUD) in the markets as Israel might respond to this attack in the coming days. This missile strike was the response to Israel’s series of attacks on Lebanon in the past weeks.
Due to this event, Bitcoin and the US S&P 500 index fell 3.98% and 0.84%, respectively,as investors flew towards safe-haven assets like Gold, which rose more than 1% on the day.
Bitcoin’s price drop triggered a wave of liquidations across the crypto market, resulting in over $500 million in total liquidations and more than $140 million specifically in BTC, according to data from CoinGlass.
US Bitcoin Spot Exchange Traded Funds (ETF) data recorded an outflow of $240.60 million on Tuesday, the largest single-day drop since September 3, and ending a streak of eight days of inflows . Studying the ETF flow data can be useful for observing institutional investors’ sentiment for Bitcoin. If this magnitude of outflows persists, demand for Bitcoin will decrease, leading to a decline in its price.
