Bitcoin Stumbled to $60,000 Triggering a $584 Million Crypto Investment Outflow

• Bitcoin investment products saw a massive $630 million outflow in the past week, totaling approximately $1.1 billion over 14 days.
• Institutions and long-term investors reduced exposure to spot Bitcoin ETFs due to uncertainty about interest rate cuts by the U.S. Federal Reserve in 2024.
• Weekly trading volumes dropped to $13.6 billion, the lowest since the launch of U.S. spot Bitcoin ETFs in January.

In a recent report by CoinShares, outflows from Bitcoin (BTC) investment products have surged, reaching $630 million over the past week. The total outflows in the last 14 days have amounted to approximately $1.1 billion. 

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Specifically, for the week ending June 21, all cryptocurrency investment products experienced a total outflow of $584 million. The decline in investment in crypto products is primarily attributed to institutions and long-term investors reducing their exposure to spot Bitcoin ETFs. 

This cautious approach comes amid the reduced likelihood of interest rate cuts by the United States Federal Reserve in 2024. According to James Butterfill, CoinShares’ Head of Research, this trend reflects investor pessimism regarding the prospect of interest rate cuts by the Fed this year.

Additionally, the report highlights a reduction in weekly trading volumes, which reached $13.6 billion. Notably, this represents the lowest volumes traded on ETPs globally since the launch of U.S. spot Bitcoin ETFs in January. 

Factors Contributing to BTC’s Dip

Despite these outflows, crypto funds still manage a substantial $92.2 billion in assets. Several factors contribute to the recent drop in Bitcoin prices. 

Firstly, the German government’s sale of BTC has impacted the market. Secondly, there is anticipation surrounding Bitcoin repayment from the Mt. Gox trustee. These developments have led to a decrease in buying activity and subsequent price corrections.

Accompanying Bitcoin’s price decline are continued outflows from spot Bitcoin ETFs. Data from Farside Investors reveals that institutions withdrew nearly $544.1 million from these ETFs between June 17 and June 21. 

Fidelity’s FBTC saw a dramatic surge in outflows, reaching $271 million for the week. As of June 24, Bitcoin’s price dropped to $60,544, marking a 6.5% decline over the past week. 

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