BlockBeats News, November 24th, the Bitcoin Exchange-Traded Fund (ETF) is currently experiencing the most severe monthly fund outflows in nearly two years, adding further pressure to the already weakened crypto market.
Bloomberg compiled data shows that investors have withdrawn $3.5 billion from U.S.-listed Bitcoin ETFs so far in November, nearly matching the record $3.6 billion outflow set in February, the highest monthly outflow in history. BlackRock’s Bitcoin fund, IBIT, accounts for about 60% of such funds’ total assets, with the fund recording $2.2 billion in redemptions in November. Without substantial inflows in the coming days, it will mark its worst monthly performance.
Citigroup’s research team quantified this phenomenon: for every $1 billion (net) outflow from Bitcoin ETFs, the price drops by approximately 3.4%, and vice versa. Citigroup analyst Alex Saunders has set a year-end bearish target of $82,000 (assuming zero inflows). The actual outflow scale has already reached billions of dollars, implying further downside potential.
Bloomberg Intelligence’s senior ETF analyst, Rebecca Sin, pointed out: “With the market’s ongoing decline and increased volatility, especially in conjunction with the current trend in gold, outflows may persist.” She also revealed that some of the withdrawals were from hedge funds unwinding a popular strategy called “basis trading,” which profits from capturing the spread between the spot and futures markets. Some institutions also use ETFs to profit from cryptocurrency volatility or hedge derivative short positions.
