Bitcoin ETF flows out of $463 million in just four trading days

Analysis of the Fund Flow of U.S. Cryptocurrency ETF for the Week of September 8

In the shortened week of September 8, U.S. cryptocurrency exchange-traded funds (ETFs) recorded a net outflow of nearly US$263 million. Although Ethereum, XRP and Solana-related products have shown positive capital inflows, this trend is overshadowed by the concentration of funds withdrawn from Bitcoin ETFs.

Summary of Core Points

• The Bitcoin ETF recorded a net outflow of nearly US$463 million in four trading days.
• The Ethereum ETF achieved a capital inflow of US$197 million this week, showing strong resilience.
• Despite their small size, capital inflows from XRP and Solana ETFs have continued.
• Federal Reserve policies and the CLARITY Act may affect the trajectory of funds flows in future trading days.

Bitcoin ETF lost US$463 million

In four trading days, Bitcoin ETF experienced a net redemption of US$462.73 million. However, this did not completely erase three consecutive weeks of inflows, including an injection of about $1 billion last week.

Specifically, the first day of redemption on Tuesday, September 8, was US$46.65 million; then surged to US$120.24 million on Wednesday and climbed further to US$282.56 million on Thursday. The pace of redemptions slowed significantly on Friday, with only a limited loss of $13.29 million recorded.

The funding distribution shows that the main contributors to this reversal are as follows:

• ARKB (jointly issued by Ark Invest and 21Shares): lost US$234.2 million.
• GBTC (Grayscale Trust): There was an outflow of US$129.1 million.
• IBIT: Withdraws US$52.5 million.
• FBTC: Loss of US$50.7 million.
• MSBT (Morgan Stanley): bucked the trend and received a net inflow of US$19.7 million.

Despite this week's decline, the Bitcoin ETF has retained nearly US$307.3 million in net inflows since early September. This suggests that current market movements reflect a temporary interruption in short-term demand rather than a complete fading of monthly accumulated funds.

Ethereum ETF attracts US$197 million

Ethereum ETF is moving in the opposite direction. Cumulative inflows this week were US$197.11 million, marking the fourth consecutive week of positive earnings. However, this result depends almost entirely on single-day performance.

On Tuesday, the relevant fund suffered a loss of $24.29 million; it rebounded on Wednesday to gain $34.75 million; and there was another outflow of $29.76 million on Thursday. It was not until Friday that the huge inflow of $216.41 million offset previous fluctuations, giving the week the final closing up.

BlackRock played a key role in this rebound. Its iShares Ethereum trust fund raised $148.8 million in a single day on Friday, while the 21Shares fund increased $29.1 million.

Investor activity also showed significant divergence. In terms of Bitcoin ETFs, trading volume fell nearly 28% in a week to $8.76 billion, while trading volume for Ethereum-related products rose 54% to approximately $5.14 billion.

XRP and Solana continue capital inflows

During this period, the XRP ETF recorded an inflow of $18.98 million. Among them, the inflow was US$1.55 million on Tuesday, US$12.29 million on Wednesday, and US$5.14 million on Thursday. There was no change on Friday.

For the Solana ETF, the week closed with a net inflow of US$10.3 million. Wednesday's $11.73 million inflow made up for smaller redemptions in other days.

Although these amounts are much lower than Bitcoin and Ethereum products, they suggest that institutional investors have not completely withdrawn from the crypto market, but have instead redistributed some of their capital to different asset classes. This divergence does not necessarily represent a lasting swing signal, as for categories with relatively limited asset size and trading volume under management, a positive earnings week may be driven by only a few major deals.

Macro Environment and Future Outlook

The reversal of Bitcoin ETF occurred in a more unfavorable environment for risky assets. Rising oil prices have heightened concerns about inflation, while investors are waiting for the Federal Reserve's monetary policy decision scheduled for September 16.

This climate also affects traditional markets. During the week of September 8, U.S. equity funds experienced a total net outflow of $32.27 billion, the largest decline in nine months.

In addition, the expected Senate vote on the CLARITY Act will also affect the flow of funds. Any development of the regulatory framework for cryptocurrencies will enhance the visibility of managers, while delays could prolong uncertainty.

Future trading days will determine whether the net outflow of Bitcoin ETFs is purely profit-taking or a deeper reversal. Fund managers 'reactions to the Fed's decisions will provide preliminary answers.