BlackRock’s (BLK) iShares Bitcoin Trust ETF (IBIT) saw investors withdraw a staggering $333 million on Thursday, according to Bloomberg. This marked the largest one-day withdrawal since the ETF’s record-breaking launch in January last year. It was also the third consecutive day of outflows for the fund, its longest losing streak to date, based on Bloomberg data. IBIT is a passively managed fund by BlackRock that seeks to track the spot price of Bitcoin (BTC-USD).
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IBIT Was Popular Among Institutional Investors
IBIT quickly became a favorite among institutional investors after its launch, amassing over $53 billion in assets and attracting nearly $37 billion in inflows. The fund’s rapid growth was driven by Bitcoin’s meteoric rise to an all-time high of $108,315 in mid-December. However, the recent outflows suggest Bitcoin’s remarkable run in 2024 may be losing steam.
Are Bitcoin-Focused ETFs Losing Momentum?
The soaring outflows for the IBIT ETF don’t appear to be an isolated incident. According to data compiled by Bloomberg, around a dozen U.S.-based Bitcoin exchange-traded funds have seen net outflows of approximately $2 billion since December 19.
In another sign of slowing demand, open interest (outstanding contracts) in Bitcoin futures hosted by the CME Group has dropped nearly 20% from its December peak. Open interest is considered a key indicator of institutional demand for the cryptocurrency.
While Bitcoin remains a dominant force in the crypto space, these outflows indicate some investors may be locking in gains after its record-breaking year.
What Is the Future Price of IBIT?
Over the past year, the IBIT ETF has surged by more than 110%, reflecting the soaring price of Bitcoin. IBIT has $51.7 billion of assets under management (AUM), with an expense ratio of 0.12%. It remains to be seen whether this ETF will continue to rise, reflecting the Bitcoin rally, or if its momentum will slow down.
