Bitcoin investors are rapidly withdrawing from spot exchange-traded funds (ETFs) as the cryptocurrency’s value took a 2.3% downturn, slipping below the $95,000 mark, and currently trading at $94,401. The dip to $92,500 spurred liquidations and withdrawals totaling approximately $570 million on January 8, marking one of the largest outflows since the ETFs launched. This mass exit occurred alongside broad market liquidations of $521.02 million, driven by investor anxiety over potential interest rate hikes signaled by positive U.S. economic data.
The Fidelity Wise Origin Bitcoin Fund experienced particularly significant outflows, contributing nearly half ($258.7 million) of the total ETF withdrawals that day. Despite these substantial market movements, investor sentiment remains largely in the “Greed” zone according to the Crypto Fear & Greed Index, though it has dipped slightly from previous levels of “Extreme Greed.”
Analysts suggest the current volatility and price fluctuations are not definitive indicators of a sustained trend, given the historically turbulent start to the year for Bitcoin. The unpredictability began with the cryptocurrency reaching a temporary peak at $102,500 earlier in January, before changing course abruptly. As such, traders remain cautiously observant of developments, recognizing this period as an indecisive start to the year.
