Positive Inflows in U.S. Bitcoin ETFs Ahead of Halving Event Despite Previous Outflows
Summary:
Following five days of outflows, the U.S. Bitcoin exchange-traded funds (ETFs) market experienced a net positive inflow right before the recent Bitcoin halving event. Outflows between April 12 and 18 were largely attributed to the Grayscale Bitcoin Trust ETF (GBTC), but a turnaround occurred on April 19 when five approved ETFs brought in $30.4 million despite outflows from GBTC and the Fidelity Wise Origin Bitcoin Fund. The last Bitcoin halving in May 2020 saw Bitcoin's value increase from $8,500 to around $65,000 in four years according to data from Cointelegraph Markets Pro and TradingView. The newest Bitcoin halving event on April 20 led to a spike in network fees with Bitcoin users spending 37.7 BTC, around $2.4 million, to claim a share of the limited halving block space.
Ahead of the Bitcoin halving event, the United States exchange-traded funds (ETFs) experienced a net positive inflow, following a five-day outflow streak. This shift was motivated by the expected surge in Bitcoin's market value post-halving, leading various global investment strategies to advocate for the inclusion of Bitcoin in existing portfolios. The last outflow streak tracked back to April 12. U.S. Bitcoin ETF net flows data sourced from Farside indicates that the sector saw outflows for five consecutive days from April 12 to 18, primarily owing to lack of participation by many players. The primary contributor for this outflow was the Grayscale Bitcoin Trust ETF (GBTC), which has been experiencing investment reductions since January after the Securities and Exchange Commission (SEC) approved bitcoin ETFs.
However, a turnaround was observed on April 19 when five of the ten approved Bitcoin ETFs saw a positive inflow that eclipsed the outflows from GBTC, injecting a total of $30.4 million into the market. Despite the GBTC and Fidelity Wise Origin Bitcoin Fund's (FBTC) cumulative outflows totaling $47.6 million, the FBTC managed to draw in $54.8 million prior to the Bitcoin halving occurrence. Other contributors to the inflow included the Bitwise Bitcoin ETF (BITB) with $4.9 million, ARK 21Shares Bitcoin ETF (ARKB) with $12.5 million, the Invesco Galaxy Bitcoin ETF (BTCO) with $3.9 million, and the Franklin Bitcoin ETF (EZBC) with $1.9 million.
The previous Bitcoin halving event happened on May 11, 2020, with an approximate market value of $8,500 at that time. The decrease in BTC issuance that followed helped the cryptocurrency's value to appreciate to almost $65,000 in just four years, according to data from Cointelegraph Markets Pro and TradingView.
The fourth halving event for Bitcoin, triggered by the 840,000th Bitcoin block, occurred on April 20 at 12:09 am UTC, causing a temporary surge in network fees attributable to high demand. Bitcoin users, hunting to secure a slice of the limited space on the fourth halving block, collectively spent a massive 37.7 BTC in fees, equaling around $2.4 million at current rates.
Published At
4/20/2024 9:09:17 AM
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