Bitcoin Faces Increased Selling Pressure, Hits Six-Week Low Amid Minor ETF Inflows
Summary:
Bitcoin's price has undergone significant selling pressure recently, sliding over 5.5% in the past week and hitting a six-week low of $58,400 on June 25. The drop has brought the price below its short-term acquisition cost and could risk a more substantial correction, according to Glassnode. Additionally, the 11 U.S. spot Bitcoin ETFs experienced minor inflows totalling $31 million, breaking a week-long outflow streak on June 25. The article emphasizes that all investment decisions should be made after thorough research due to associated risks.
The price of Bitcoin (BTC) has been under considerable selling pressure recently, leading to a slide of over 5.5% in the past week and hitting a six-week low of $58,400 on June 25. Amid this market downturn, BTC's price fell below its short-term acquisition cost, creating the potential for a more severe dip, as per the analysis of market research company Glassnode. "As of mid-June, the spot price fell beneath the acquisition costs of holders ranged between one week to one month ($68.5k), furthermore, one to three months ($66.4k)," stated Glassnode in their On-chain Report issued on June 25. "The persistence of this pattern can usually lead to a decrease in investor faith, increasing the risk of a more intense correction with a longer recovery period."
The cost basis or realised price of Bitcoin for short-term holders (STH) - typically calculated involving currencies held for no more than 155 days - represents an average purchase price. Current data from LookIntoBitcoin indicates that Bitcoin’s breach of $64,000 on June 23 brought it under the STH Realised price at that point, which was $64,591.
Moreover, the latest slump was just short of sending the price below the acquisition cost of holders ranging from three to six months at $57,300, ascending while the price declines. The report underlines that the acquisition cost for 1w-1m holders has fallen beneath 1m-3m holders' cost, indicating "a slowdown in demand surge and net capital flight from the asset.”
In previous bull runs, such a negative capital flow pattern has occurred up to five times. This pattern has been observed since May through early June.
On another note, the 11 U.S. spot Bitcoin ETFs witnessed minor inflows totalling $31 million on June 25, snapping a week-long outflow streak. According to SoSo Value, among them, Fidelity’s ETF FBTC led with $49 million inflows on June 25, followed by Bitwise Bitcoin ETF BITB with $15 million and VanEck Bitcoin Trust ETF HODL with $4 million inflows.
Conversely, Grayscale ETF GBTC and ARK 21Shares Bitcoin ETF registered single-day outflows of $30.2 million and $6 million, respectively. Since commencing operations on January 11, the 11 Spot Bitcoin funds have collectively seen net inflows worth $14.42 billion, managing over $53.56 billion in assets.
The substantial outflows over the past few weeks are at their highest since April, where total net outflows soared over $1.2 billion between April 24 and early May.
Please note this is not a call to investment or trading action. All investment or trading decisions involve risk, and due diligence should be done by the reader.
Published At
6/26/2024 7:55:48 PM
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