Following a period of substantial inflows, U.S. spot Bitcoin and Ethereum exchange-traded funds (ETFs) are facing a season of major outflows. During this time, Bitcoin ETFs are leading, and these withdrawals are reflecting the price of the underlying asset.
Data reviewed by analysts at the crypto exchange Bitfinex revealed that investors withdrew at least $1.18 billion from spot Bitcoin ETFs last week. Their Ethereum counterparts saw fewer outflows, possibly due to the ongoing capital rotation into the altcoin market.
A Week of Consistent Outflows
Bitcoin ETFs have recorded net outflows of more than $1.5 billion over six consecutive trading days from August 15 to 22. The negative numbers came after a seven-day streak of inflows leading up to bitcoin’s latest all-time high (ATH) of over $124,000. Market experts believe the demand decline reflects a more measured appetite from investors at this stage in the bull cycle.
Within the same timeframe, Ethereum ETFs have also witnessed outflows exceeding $918 million; however, the negative streak did not continue beyond August 20. Despite these outflows, ETH proceeded to reach an ATH above $4,940 on August 24, although it had retraced at press time. Bitcoin, on the other hand, has been on a decline, tumbling by over $15,000 from top to bottom.
Investors’ risk-off approach to the Jackson Hole symposium exacerbated bitcoin’s decline; they de-risked their investments ahead of the meeting. Although the market took a dovish stance after the meeting, BTC could not maintain the bullish momentum. The leading digital asset slumped below $109,000 on Monday.
Institutions Support ETH Momentum
While BTC struggled to stay bullish, ETH was on the rise, driven by persistent accumulation from Ethereum treasury companies. These entities have been absorbing a significant portion of the selling pressure on ETH, reducing downside risk. They have provided meaningful support, with their consistency helping Ethereum ETFs to outpace their Bitcoin counterparts.
Interestingly, the ETH treasury company Bitmine Immersion Technologies has overtaken MARA Holdings to become the second-largest digital asset treasury. MARA is a Bitcoin mining firm. Such developments underscore ether’s new role as a liquidity driver for institutional markets.
While this week’s price momentum for BTC and ETH hinges on inflows from institutions and treasury companies, Bitfinex urges traders to keep their expectations low. This is because historically, risk asset ETFs often witness a slowdown in positive flows towards the end of summer in August and September.
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