It’s no secret anymore that the 2024 bull run has been quite different than previous ones, at least in terms of when the all-time high came and how BTC has moved post-halving.
The past week or so has not been kind to the asset as it dumped to a monthly low of $55,300. Are the outflows from the spot Bitcoin ETFs to blame?
ETF Exodus Continues
It was less than two weeks ago when the primary cryptocurrency’s price was riding high on positive developments coming from the US, such as the Fed Chair’s promise to start lowering the interest rates and the support the pro-crypto presidential candidate, Donald Trump, had received. At the time, the asset flew past $65,000 for the first time since the early August massacre.
However, the landscape quickly changed, and BTC lost about ten grand until earlier today when it plunged to the aforementioned low of $55,300 (on Bitstamp). While the interest rate narrative is still ongoing, as the Fed is expected to cut the rates this month, and Trump is in the lead in the presidential race, the only thing that has seemingly changed is US investors’ perspective and behavior toward the spot Bitcoin ETFs.
CryptoPotato reported last weekend the substantial withdrawals that hit the financial products during the then-business week. The situation worsened this week as the outflows skyrocketed to more than $500 million in just three trading days (Monday was a national holiday in the States). In fact, the $287.8 million pulled out on Tuesday was the most since early May.
Is This Why BTC’s Price Tumbles?
While the speculations on why BTC fails to break its March 2024 ATH of $73,800 are ongoing , the reality is that the flows toward the spot Bitcoin ETFs have severely impacted the asset’s price since their inception in mid-January.
As such, the current negative streak of seven consecutive days of outflows seems to be the most probable reason behind BTC’s price descent. The cryptocurrency is down by roughly 25% since its peak in March.
Moreover, the community now wonders whether the potential rate cut by the Fed and the possible win for Donald Trump have already been priced in. If that’s indeed the case, the 2024 bull run could actually be over now.
Then again, BTC has proven time and time again that it tends to do the opposite of what people expect from it and has ‘come back from the dead’ more times than we can count. Consequently, we wouldn’t be so foolish as to underestimate the largest digital asset by market cap.
