The week ending April 26, 2024, saw Bitcoin spot exchange-traded funds (ETFs) in the United States experience a record outflow of $328 million. This massive withdrawal of funds coincided with a broader downturn in the crypto market, posing concerns about the future of Bitcoin ETFs and the trajectory of the cryptocurrency's price post-halving.

The trend of significant fluctuations in net flows raised questions about the stability of Bitcoin ETFs. In the early days of the week, there were robust inflows amounting to $62.02 million across various Bitcoin ETFs. However, by Wednesday, April 24, market sentiments shifted, resulting in a net outflow of $120 million.

Market Sentiments Propel Outflows

The trend of outflows continued, with Thursday, April 25, seeing a significant outflow of $217 million across all 10 spot Bitcoin ETFs. Grayscale's GBTC led the outflows with $140 million, while Fidelity's FBTC had the highest net inflow. Despite some positive activity, the week ended with a total outflow of $328 million, marking a shift in Bitcoin ETF sentiment.

Impact of DTCC's Policy on ETF Collateral

The significant outflows from Bitcoin ETFs have led to speculation about their future, especially following the announcement from the Depository Trust Company (DTCC) regarding the valuation of collateral for ETFs containing Bitcoin or other cryptocurrencies. The DTCC's decision to enforce a 100% haircut on ETFs with cryptocurrency exposure starting from April 30 has caused unease among investors in the crypto space and sent shockwaves through the market.