Bitcoin ETF sees $175 million net outflow in a single day, analysts: BTC may retreat to $40,000

Amid the holiday season with declining liquidity, the US spot Bitcoin ETF has experienced another significant outflow of funds. Data shows a single-day net outflow of $175 million, marking the fifth consecutive trading day of net outflows, reflecting cautious sentiment among institutional investors regarding short-term Bitcoin price movements.

According to Farside Investors data, this round of capital outflows is still led by the iShares Bitcoin Trust (IBIT) under BlackRock, with a net outflow of approximately $91.4 million on the day. Grayscale GBTC and Fidelity FBTC saw outflows of about $24.6 million and $17.2 million, respectively. Spot Bitcoin ETFs from Bitwise, Ark 21Shares, VanEck, and Franklin Templeton also experienced simultaneous capital withdrawals. As a result, the total net inflow of spot Bitcoin ETFs has decreased from $62.7 billion to approximately $56.8 billion.

Market pressure is mainly concentrated on upcoming derivative expiration events. About $23 billion worth of Bitcoin options on the Deribit platform are nearing expiration, and the open interest related to IBIT is also at high levels. In an environment of light holiday trading and narrowing implied volatility, investors tend to reduce risk exposure and engage in tax-loss harvesting. Similar ETF capital outflow patterns also occurred before last year’s Christmas and New Year holidays.

Several analysts have issued bearish outlooks on Bitcoin prices. 10x Research pointed out that, in the short term, the lack of new bullish catalysts and the cooling of market expectations regarding a shift in Federal Reserve policy limit Bitcoin’s rebound momentum. From a technical analysis perspective, some analysts believe that Bitcoin risks further downside after breaking below key weekly moving averages.

Senior trader Peter Brandt and Tom Lee of Fundstrat have mentioned that $60,000 could become the next support zone. Analyst Ali Martinez noted that historical data shows that after Bitcoin falls below the 50-week moving average, the average correction can reach 60%, with a potential target around $40,000. Others believe the potential bottom range for Bitcoin is between $35,000 and $45,000.

As of now, Bitcoin is trading at approximately $87,730, with 24-hour trading volume significantly declining. In the short term, the flow of funds into spot Bitcoin ETFs, macroeconomic environment, and options market dynamics will remain key variables influencing BTC price movements.