Crypto Market Watch: BlackRock’s IBIT Faces Outflows Amid Economic Uncertainty

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The digital assets investment products – led by BlackRock’s IBIT and ARK 21Shares Bitcoin ETF (ARKB) – registered a net cash outflow of $305 million last week. The widespread fear of further crypto capitulation in September has pushed more investors to take some profits and shield their capital.

Stronger-than-expected economic data in the United States have substantially reduced the likelihood of the anticipated 50 basis points interest rate cut later this month. Nonetheless, Fed Chair Jerome Powell highlighted during the Jackson Hole meeting last month that the commission will be monitoring live data ahead of the upcoming economic shift following the end of the five years.

BlackRock’s IBIT Registers 2nd Daily Outflow Since Inception

BlackRock’s iShares Bitcoin Trust (IBIT) has experienced low investor demand in recent years. On August 29, IBIT reported a net cash outflow of about $13.5 million, the second since its $36.9 million outflow on May 1, 2024.

Nonetheless, BlackRock’s IBIT has grown impressively since its inception to a net cumulative cash inflow of about $20.92 billion. Remarkably, BlackRock’s IBIT has registered positive cash inflows every week since its inception, despite the turbulent performance of the rest of the spot Bitcoin ETF issuers.

Market Picture

Bitcoin's price action now echoes the calm before the storm, marking the end of a "Blue Year"—a crucial, quiet period setting up for the explosive "Red Year."

Historically, this phase has preceded all-time highs, as seen in 2012, 2016, and 2020, hinting at the next big surge on… pic.twitter.com/zonpawtK7g

— Kyledoops (@kyledoops) September 1, 2024

Despite the heightened fear of further crypto correction in September to mirror historical trends, on-chain data shows more than 40k BTCs were withdrawn from different exchanges in the past few days. The anticipated bullish recovery in the fourth quarter and the first half of next year has influenced more long-term investors, led by MicroStrategy and El Salvador, to accumulate more units.

From a technical standpoint, Bitcoin price has been forming a potential bullish flag in the past few months, often followed by a robust uptrend momentum.

Also Read: Why $58,400 is Crucial for Bitcoin and How It Could Pave the Way to $100,000

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