In a notable shift in the cryptocurrency landscape, spot Bitcoin exchange-traded funds (ETFs) in the US have marked a significant recovery, ending a streak of net outflows that lasted for five weeks. For the trading week ending March 21, Bitcoin ETFs reported a net inflow of $744.35 million, the largest sum seen in eight weeks, signaling renewed investor interest.
The inflow streak has now continued for six consecutive days, as confirmed by data from SoSoValue. This positive trend can be largely attributed to five key funds, most prominently BlackRock’s iShares Bitcoin Trust (IBIT), which alone contributed $537.5 million to the total. Additionally, Fidelity’s Wise Origin Bitcoin Fund (FBTC) added $136.5 million to the inflow figures.
These recent inflows come on the heels of a bearish period not only for the cryptocurrency market but also for the broader global economy. Concerns regarding escalating trade tensions and rising recession fears have heavily influenced market dynamics. Scholars have noted that if the United States undergoes a recession, it could remarkably impact Bitcoin’s performance, potentially leading to increased investment in the digital currency.
Prior to this recent influx, Bitcoin ETFs enjoyed significant inflows of $1.96 billion and $1.76 billion in the weeks ending January 17 and January 24, respectively, coinciding with Bitcoin’s surge to an all-time high of $109,000 on January 20, shortly after the inauguration of former President Donald Trump. However, as the market corrected, Bitcoin’s value fell to approximately $78,000. The recent resurgence of inflows has allowed Bitcoin’s price to rebound to $87,343 at the time of this report, according to CoinGecko.
Bitcoin Leaves Ethereum Struggling
The situation for Ethereum (ETH) is markedly different, as it continues to face challenges even while Bitcoin experiences a turnaround. Ethereum ETFs extended their weekly net outflow streak to four weeks, with a marked net outflow of $102.89 million noted during the week ending March 21. BlackRock’s iShares Ethereum Trust ETF (ETHA) accounted for $74 million of this outflow.
At present, Ether is trading at around $2,090, having recently dipped below the $2,000 mark for the first time in over a year. Despite the outflows, a positive development for Ethereum has been the deepening institutional interest. BlackRock’s BUIDL fund, which focuses on tokenized real-world assets, has seen its investment in Ether climb to a record $1.145 billion, representing increased confidence from one of the world’s largest asset managers in Ethereum’s potential for real-world applications.
Improved Sentiment Amid Caution
Market sentiment surrounding cryptocurrencies has shown signs of improvement, with the Crypto Fear & Greed Index rising to 45%, up from 32 in the previous week. Nevertheless, experts from QCP Capital, a Singapore-based investment firm, advise vigilance among investors, cautioning that upcoming tariff escalations scheduled for April 2 may once again impact risk assets.
As the market continues to evolve, investors are encouraged to remain informed and responsive to the changing dynamics within the cryptocurrency ecosystem.
