Spot Bitcoin ETFs Record Second Largest Single-Day Net Outflow Ahead Of US Elections

On Monday, spot Bitcoin exchange-traded funds (ETFs) registered their second-largest single-day net outflow since their launch in January. The crypto-based investment products saw their second consecutive red day before the US elections, ending a seven-day positive streak.

US-listed spot Bitcoin (BTC) ETFs started the month negatively after recording two days of outflows. The investment products performed remarkably for most of October, seeing four consecutive green weeks and surpassing the $2 billion mark twice.

Last week, Bitcoin ETF recorded $2.2 billion in inflows, leading the crypto investment products’ positive performance for the fourth week straight. However, the funds saw a significant net flow decrease from October 30 to October 31 as Bitcoin’s price struggled, going from $893.3 million in inflows to only $32.3 million.

On Friday, BTC ETFs had their first red day since October 22, ending their seven-day streak with $54.9 million in outflows. The negative sentiment continued at the start of this week, as Bitcoin-based investment products registered the second-largest single-day net outflow since their launch in January.

The funds saw their largest red-performing day on May 2nd, with $563 million in outflows. Meanwhile, Bitcoin ETFs saw $541.1 million in outflows this Monday. Reportedly, Bitwise’s BITB, AKR Invest’s ARKB, and Grayscale’s Mini Trust (BTC) had record outflow days on November 4.

According to data from Farside Investors, BITB and BTC saw $79.8 million and $89.5 million in outflows, respectively, while ARB registered $138.3 million in negative net flows. Nonetheless, Fidelity’s FBTC led yesterday’s losses with $169.6 million in outflows, its second worst-performing day.

BlackRock’s IBIT was the only BTC ETF to see a positive net flow yesterday, with $38.4 million in inflows.

Bitcoin ETFs’ massive outflows occurred just one day before the US elections. Experts concurred that the market volatility and speculation surrounding the election’s outcome have affected the investment products.

In a Tuesday interview, Bloomberg analyst Eric Balchunas noted that the election is a big variable that could further impact Bitcoin’s price action and ETFs’ performance.

Nonetheless, he considers that the investment products’ net flow, which is at $29 billion, has held “real thought” throughout the “couple of downturns” seen this year, suggesting BTC ETFs’ performance will surpass all expectations for its first year, even if the election’s outcome negatively impacts the market.

Balchunas called ETFs the “premier vehicle” for traditional investors and a “disruptive powerhouse” that has “a lot of spiritual connection” with Bitcoin. To the analyst, these connections make Bitcoins ETFs a strong long-term combination.

Meanwhile, Bitwise’s Chief Investment Officer (CIO), Matt Hougan, considers that “crypto has already won” regardless of the election’s outcome but suggested that a Trump victory would be better for the market in the short term.

To Hougan, the only possible “bad” outcome would be a Democratic sweep. However, he would remain bullish on that scenario and buy the dip as the past four years have taught him that “Washington can’t stop crypto.”

Ultimately, Bitwise’s CIO asserted that spot crypto-based ETFs will continue to see inflows, and the industry will continue to grow, even if the market slows down.