• US-based spot Bitcoin ETFs experienced a sharp decline in net inflows, dropping to just $132 million on March 14.
  • The decline in ETF inflows correlates with the volatility of the BTC price, which peaked at over $73,000 before reversing.

OUR TAKE:
The recent decline in spot Bitcoin ETF inflows reflects investor caution amid market volatility, regulatory uncertainty, and macroeconomic factors. The fluctuating BTC price and anticipation of the Federal Open Market Committee meeting are likely influencing investor sentiment.
— Iris Deng, BTW reporter

US-based spot bitcoin ETFs net inflows dropped by 80% as BTC price slumped.

US-base spot bitcoin exchange-traded funds (ETFs) dropped by 80% on March 14, as the BTC price slumped

On March 14, the United States-based spot bitcoin ETFs, which is an open-end fund that can be bought and sold on a stock exchange, recorded one of their lowest net inflow days of just $132 million. It was the lowest level in the past 8 trading days and 80% fall from March 13.

It has kept dropping for two days. On Wednesday, inflows hit $684 million, a 38.3% drop from the March 12. Earlier on Tuesday, the single-day inflows peaked at $1.05 billion.

Bitcoin rose and then dumped to a ten-day low last week

The total flow of funds into the ETFs reached $390 million on March 14, with the Grayscale Bitcoin Trust ETF (GBTC), one of the first spot Bitcoin ETFs in the US, seeing another $257 million in outflows. It brought net inflows to $132 million. At the same time, the VanEck Bitcoin Trust ETF and Fidelity’s Wise Origin Bitcoin Fund recorded inflows of $13.8 million and $13.7 million, respectively. Therefore, despite a significant outflow from GBTC, net flows remained positive on Thursday.

However, when the price of BTC fell below $69,000 and there was a broader downtown in the cryptocurrency market, investors had a change of heart. The decline in ETF inflows has corresponded with the volatility of the BTC price. It peaked at over $73,000 as a record on Wednesday, following reversing on Thursday.

Market participants suspect that current market volatility, regulatory uncertainty, and macroeconomic factors have made investors cautious. The current decline is also attributed to next week’s Federal Open Market Committee meeting, which could shed light on the Fed’s future interest rate plans.