US Market Slump Spoils Crypto Market Recovery, Bitcoin ETFs See Net Outflows

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On Monday, April 15, Bitcoin (BTC) and other cryptocurrencies experienced a significant rebound during Asian trading hours, thanks to the debut of Hong Kong’s spot Bitcoin ETFs. However, this recovery took a hit later in the day when the US market declined, causing Bitcoin’s price to drop by nearly 4.6% and fall below the $62,500 mark.

Dow Jones Drop for Sixth Consecutive Session

For the sixth day in a row, the Dow Jones Industrial Average closed with a decrease, dropping by 250 points to reach a total of 37,735 on Monday.

Last week’s downward trend in U.S. stocks intensified, with the sell-off driven by a sudden increase in Treasury yields following strong consumer spending data. The Nasdaq Composite took a hit with a steep drop of 1.8%, while the S&P 500 and Dow Jones Industrial Average both retreated, losing 1.2% and 0.7% respectively.

A stronger-than-anticipated consumer spending report caused Treasury yields to rise even higher, going beyond the yearly peak set by the previous week’s inflation figures. The 10-year yield broke through the 4.6% mark, a level not reached since November.

After this latest development, Bitcoin (BTC) and the wider cryptocurrency market experienced significant selling, causing a 4% decrease in Bitcoin’s price. Similarly, several leading altcoins dropped by 5-10%, dealing with even greater selling pressures.

The CEO of Crypto.com exchange predicts that Bitcoin sales may increase as the halving date for Bitcoin draws near. However, he believes that in the long run, this event will boost the value of Bitcoin. In an interview with Bloomberg, Kris Marszalek made this statement.

Approaching that date, some investors might decide to sell their Bitcoins in anticipation of market news, a common trading strategy known as buy-the-rumor, sell-the-news. I predict significant price fluctuations within the next six months following the Bitcoin halving event.

BTC ETFs Register Net Outflows

The past week saw a disappointing beginning for Bitcoin ETFs in the US market, with total net investments turning negative at approximately $37 million. While BlackRock’s IBIT Bitcoin ETF attracted $73 million in new funds, GBTC experienced outflows totaling $110 million, according to Farside Investors data. Due to persistent outflows, the GBTC holdings of Bitcoin have decreased by half, despite its high management fee.

The other “halving”: GBTC bitcoin holdings are down exactly 50% since the launch of bitcoin ETFs
— zerohedge (@zerohedge) April 15, 2024

Over the last two weeks of April, the demand for Bitcoin ETFs, which had been strong since their launch two months prior, has noticeably decreased. As a result, critics of Bitcoin like Peter Schiff have seized the opportunity to voice their concerns about Bitcoin’s comparison to gold.

If you own a Bitcoin ETF and think that Bitcoin functions as a digital alternative to gold, it’s worth pondering why the value of gold ETFs like GLD is increasing by 1.9% today, reaching an all-time high closing price. Meanwhile, your Bitcoin ETF investments are experiencing a 5% decrease. It’s possible that your theory might be flawed, and you may consider selling your “fool’s gold” (Bitcoin) and purchasing the genuine article (gold).

— Peter Schiff (@PeterSchiff) April 15, 2024

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2024-04-16 08:40