Bitcoin (BTC) is back in the spotlight, pulling off a dramatic price rebound, while Exchange-traded Funds (ETFs) tied to the asset see massive outflows. On Tuesday, BlackRock’s iShares Bitcoin ETF (IBIT) recorded its biggest outflow. As U.S. spot Bitcoin ETFs see four straight days of withdrawals, over $1.5 billion has vanished, leaving traders wondering what is next.
BlackRock’s Historic Outflow Shakes Confidence
BlackRock’s IBIT made headlines with its largest outflow since its inception, as $188.7 million exited the ETF on December 25. This record nearly doubled the $72.7 million record set just last Friday. Data from Farside Investors revealed that the U.S.-based spot Bitcoin ETFs suffered four consecutive days of outflows, totaling $338.4 million.
Fidelity’s FBTC and Ark Invest’s ARKB contributed $83.2 million and $75 million, respectively, amplifying the bearish signals. The timing of these withdrawals has sparked debate among traders and analysts. This is because the holiday season is usually a period of low liquidity.
Predictions of a market crash around Donald Trump’s inauguration and sudden sell-offs highlight the market’s cautious sentiment.
Market Optimism Rekindled with Bitcoin’s Price Recovery
Despite ETF outflows, Bitcoin’s price demonstrated resilience as traders fueled a potential Santa rally. The asset surged from $94,000 to $99,000, up by 5.70% within 24 hours, as per CoinMarketCap data.
For now, BTC holds strong above $98,000. But as optimism grows, so does the risk of profit-taking. Analysts are closely monitoring the $100,000 level as liquidity at this price point and beyond could shape the next move.
Ethereum (ETH) and other altcoins also participated in the recovery, signaling a broader market rebound. However, the declining trading volume, which has dropped by 24% in the past 24 hours, signals reduced enthusiasm among retail investors.
Institutions Bet Big Amid Uncertainty
While some investors pull back, institutional players are doubling down. MicroStrategy’s Michael Saylor has called for a shareholder vote on a bold plan to expand their Bitcoin reserves. Other firms like Matador Technologies and Metaplanet are also scooping up Bitcoin, seeing opportunity in the chaos.
The upcoming Bitcoin options expiry of 147 BTC on Deribit, with a notional value of $14.4 billion, could bring more pressure on the market. With a max pain price of $84,000 and a put-call ratio 0.68, volatility is likely to rise; traders position themselves for the new year.
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