Bitcoin ETFs See End-of-Year Bleeding With $387 Million Weekly Outflows

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As a seasoned crypto investor with over a decade of experience in the digital asset market, I’ve weathered numerous ups and downs, but the recent performance of Bitcoin ETFs has left me scratching my head. Just when I thought we were entering the holiday season on a high note, the industry took a turn for the worse during Christmas week.

I remember vividly the excitement that swept through the market when the first Bitcoin ETFs were announced earlier this year. As an investor who has closely followed the crypto space since its inception, it was thrilling to see traditional financial institutions finally embracing digital assets. However, watching these investment products register their worst weekly performance since September has been a humbling reminder that even the most promising ventures can face setbacks.

It’s important to keep things in perspective; despite this recent downturn, 2024 has still proven to be an exceptional year for ETFs. The surge in active funds and investor interest has been nothing short of remarkable, with new crypto-based investment products driving much of the growth. I can only imagine the excitement that traditional investors must feel as they dip their toes into the world of Bitcoin and other digital assets.

As a long-time believer in the potential of cryptocurrencies, I remain optimistic about the future of Bitcoin ETFs. They have shown resilience during downturns and have exceeded expectations this year, with $35.65 billion in positive net flows throughout 2024. I believe that these products will continue to grow and mature, eventually becoming an integral part of traditional investment portfolios.

To lighten the mood, let me share a little joke: Why did the Bitcoin ETF go to therapy? Because it was feeling a little down after its Christmas week performance! But remember, even in the face of adversity, we must remain patient and focused on the long-term potential of our investments. Happy investing!

Over the festive season, I noticed a downturn in the weekly performance of Bitcoin ETFs, marking their weakest week since September. Yet, despite this dip, analysts emphasized that the ETF sector experienced its most prosperous year to date.

Bitcoin ETFs Receive Charcoal For Christmas

Over the past week, ending at the close of the year, Bitcoin Exchange-Traded Funds (ETFs) have experienced their poorest weekly performance in approximately three months. From December 23 to December 27, these crypto-related investment products experienced substantial withdrawals, resulting in a streak of three consecutive negative days last week.

As a researcher studying the behavior of Bitcoin Exchange-Traded Funds (ETFs), I observed an initial negative net flow of 564.94 million for the first two days of the week. However, this negative trend briefly reversed on December 26, with positive activity picking up. This was during the Christmas rally, where Bitcoin spiked back to the $98,000-$99,000 price range. Notably, the BTC investment products experienced their best inflow since the streak began, recording a substantial $475.5 million on that day.

On Friday, there were $297.75 million in outflows, which stopped the positive trend and led to a total outflow of $862.69 million for the entire week. Consequently, Bitcoin ETFs experienced a net negative volume of $387.54 million during the final week of 2024.

This week’s largest investment fund losing streak was held by Fidelity’s FBTC, experiencing an outflow of approximately $208 million on Friday – its second-worst daily performance in the month. BlackRock’s IBIT came in a close second with a net outflow of about $188.7 million.

Over the past seven days, ARK 21Shares’s ARKB had the second-highest investment inflows, ending the week with approximately $186.9 million. Last week, FBTC saw its best performance this month and recorded the largest inflows among all funds, with a staggering $254.4 million on Thursday.

Best-Performing Year For ETFs

It’s important to mention that for the last fortnight, there has been a significant decrease in funds flowing into investment products. This marks an end to a 15-day streak where Bitcoin ETFs witnessed a growth in their total net assets from $100 billion to $120 billion.

As a researcher, I’ve observed an intriguing trend: According to ETF expert and Bloomberg analyst Eric Balchunas, the total net assets of spot Bitcoin ETFs have almost reached the $128 billion mark held by gold ETFs as of December 17. Remarkably, this achievement was made in just 11 months, a short timeframe that underscores the extraordinary performance of these crypto-based products. In fact, it’s quite surprising to even be discussing them being this close given their relatively recent introduction to the market.

Based on information from SoSoValue, the cumulative redemption of Bitcoin ETFs has exceeded $1.8 billion, and their total net value has dropped to approximately $106.68 billion due to underperformance.

As an analyst, I’m sharing some insightful words from Matthew Bartolini, Head of SPDR Americas Research at State Street Global Advisors. He recently stated to FOX Business that this year has been exceptionally prosperous for the global ETF (Exchange-Traded Fund) industry, marking it as its best year on record.

This year saw a significant increase in the number of active funds and investor demand surging for innovative crypto-centric investment options. Sumit Roy, a senior analyst for ETF.com, stated that the introduction of new ETFs was a key factor behind this year’s exceptional growth.

One additional factor relates to the debut of Exchange-Traded Funds (ETFs) for cryptocurrencies. In fact, Spot Bitcoin ETFs started appearing in January, and the influx of funds has been unprecedented.

Earlier observations indicated that Bitcoin ETFs serve as the primary tool for conventional investors, representing a powerful disruptor in the financial landscape, with a profound link to Bitcoin. This connection makes these investment vehicles a strong, enduring partnership for the long term.

The analyst underscored that Bitcoin Spot ETFs have demonstrated remarkable resilience during this year’s market declines, implying that they are poised to exceed predictions even amid temporary setbacks.

Remarkably, Bitcoin Exchange-Traded Funds (ETFs) have exceeded predictions significantly this year, bringing in a total of $35.65 billion in positive investments as per Farside Invest data for the year 2024.

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2024-12-31 08:12