The US Bitcoin ETF market has witnessed five consecutive days of outflows hinting that the investor sentiment has been waning recently. Yesterday, Bitcoin spot ETFs experienced a total net outflow of $4.38 million. Notably, Grayscale ETF GBTC saw a significant net outflow of $89.99 million on the day, contributing to its historical total net outflow of $16.6 billion.
The outflows from the Grayscale Bitcoin ETF GBTC have refused to stop eroding more than 50% of the company’s Bitcoin holdings ever since the ETF launch on January 24. On the other hand, GBTC backers remain hopeful for the outflows to slow down while estimating that more than half of the fund’s remaining assets are stuck in taxable accounts.
These analysts believe that investors are unlikely to sell the GBTC holdings and incur large tax bills unless and until they are willing to exit their Bitcoin investments entirely. Ryan Selkis, a former executive at Grayscale’s parent group DCG stated:
“No one is going to buy another bitcoin ETF and concurrently take a 30% tax hit on capital gains just to save 1% a year (in fees)”.
Previously, there were reports that bankrupt players like FTX, Genesis, etc. have been selling their GBTC holdings. However, the high management fees have also been a major reason behind this GBTC exodus that refuses to stop. Grayscale CEO Michael Sonnenshein has stated that he would be reducing the GBTC fees, however, hasn’t mentioned when that would happen.
While the Grayscale Bitcoin ETF GBTC records strong outflows, BlackRock on the other hand, has registered consistent inflows for the past 70 days in a row. On Thursday, April 18, the inflows in BlackRock’s IBIT Bitcoin ETf stood at $18.7 million. With this, the total inflows in IBIT have now surpassed to over $15.4 billion.
On the other hand, Fidelity’s ETF FBTC recorded the highest net inflow among Bitcoin spot ETFs, with $37.39 million.
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