Bitcoin ETF Outflows Hit $635M After $1B Inflow Surge. Institutional Demand on the Test.

U.S. spot Bitcoin exchange-traded funds (ETFs) recorded $635.5 million in net outflows on Thursday, October 22, marking their largest single-day withdrawal since June 25. 

The reversal came after the funds attracted more than $1 billion earlier in the week, raising questions about the strength of demand following a brief recovery in Bitcoin’s price.

Spot Ether ETFs also recorded $110.5 million in net outflows on Thursday, with BlackRock’s iShares Ethereum Trust (ETHA) accounting for $75.45 million of the withdrawals, according to SoSoValue data.

Bitcoin failed to hold its rebound toward $85,000 and fell to around $81,200 on Thursday. The drop followed several days of daily ETF inflows above $500 million.

Bitcoin price movement coincided with more than $315M of liquidations of leveraged positions across crypto markets. 

The broader market also sold off on Thursday. The S&P 500 fell 1.2%, while the Nasdaq Composite dropped 2.6%, its biggest daily decline since June. Technology and AI stocks led the losses, while Brent crude oil prices climbed to a five-month high, adding to concerns about persistent inflation. 

Additionally, Bitcoin treasury companies that hold Bitcoin on their balance sheets are “barely buying”, despite being in profit, Glassnode analysis says.

Glassnode estimates that Bitcoin treasury companies hold BTC at an average cost of around $80,200. Yet corporate buying remains muted. A slowdown in these purchases could limit an additional source of demand for Bitcoin.

Crypto investor and analyst Ted Pillows highlighted a potential technical concern, saying Bitcoin had recorded its first daily close below the 50-day moving average in more than two months. 

However, he added that the weekly structure remained intact and said a close above $82,000 would help restore buyers’ control, according to a post on X on October 22.

ETF flows are a key gauge of institutional appetite for Bitcoin, and a sharp reversal can signal shifting sentiment. With Bitcoin near key technical levels and equities under pressure, flows in the coming sessions may show whether Thursday’s outflow was a pause or a trend change.

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