Bitcoin ETFs Face Record Outflows Amid Market Decline

Bitcoin exchange-traded funds (ETFs) experienced a substantial sell-off on December 19, recording net outflows of $671.9 million in a single day—the largest outflow event of the year. 

This movement coincided with a decline in Bitcoin’s price, which hovered around $96,409, and a broader market liquidation exceeding $1 billion within 24 hours.

Bitcoin ETFs Suffer Massive Outflows

According to data from Farside Investors, the largest outflows were seen in Grayscale’s GBTC, which shed $642.5 million, followed by ARK Invest’s ARKB with $208 million in outflows. 

By December 19, the total net assets of Bitcoin ETFs stood at $109.7 billion, a sharp drop from $121.7 billion just two days earlier, erasing much of the gains recorded earlier in December.

The sell-off in Bitcoin ETFs also led to a cumulative crypto ETF net outflow of $732.4 million, as reported by CoinMarketCap. 

Despite these losses, Bitcoin maintained its dominance in the cryptocurrency market at 57.4%. Analysts suggested that the rapid downturn resulted from the market being “completely unprepared for bad news,” indicating the decline may be temporary

Say Goodbye to a Bitcoin Reserve (For Now)

President-elect Donald Trump’s forthcoming administration has recently driven Bitcoin’s price above $108,000. But this optimism was short-lived thanks to Federal Reserve Chair Jerome Powell. 

While the market anticipated a 0.25% rate cut, Powell’s comments indicated only two additional rate cuts were planned for 2025, leading to a decline in consumer confidence, a stock market downturn, and crypto markets taking a hit after Powell stated that the Fed cannot own Bitcoin that same day.

Related: Crypto Liquidations Exceed $1B Following Controversial Fed Statements