New York.– U.S. bitcoin exchange-traded funds have recorded their longest streak of daily net outflows since the company began trading on an exchange earlier this year, part of a broader retreat from riskier assets amid a tough period for global markets, Bloomberg reported.
Investors pulled about $1.2 billion in total from the group of 12 exchange-traded funds (ETFs) over the eight days through Sept. 6, data compiled by Bloomberg show.
The drop comes amid a turbulent period for stocks and commodities due to concerns about economic growth. Mixed US employment data and deflationary pressure in China are weighing on traders.
Uncertainty is roiling the cryptocurrency market, whose swings have become more closely tied to stock movements based on a growing short-term correlation.
Bitcoin has struggled in September, posting a loss of about 7 percent. But the largest digital asset reaped modest gains over the weekend and was up about 1 percent to $54,870 as of 1 p.m. Monday in Singapore. “The small relief rally appears to be driven in part by some prominent influencers closing out their short positions,” said Sean McNulty, chief operating officer at liquidity provider Arbelos Markets. He cited as an example a recent social media post by Arthur Hayes, co-founder of trading platform BitMEX. A spike in polls and prediction markets for Donald Trump, the pro-crypto Republican candidate for the U.S. presidential election, may also be playing a role, McNulty said. He reported increased demand for options hedging in case Tuesday’s debate between Trump and Democratic nominee Vice President Kamala Harris stokes volatility. Harris has yet to detail her stance on cryptocurrencies. U.S. bitcoin ETFs that invest directly in the original cryptocurrency debuted in January to much fanfare. Unexpectedly strong demand from the funds helped push the token to an all-time high of $73,798 in March. Inflows subsequently moderated, and bitcoin’s year-to-date rally has cooled to about 30 percent. The token is likely to trade in its recent range of $53,000 to $57,000 until the U.S. releases consumer price data on Wednesday, said Caroline Mauron, co-founder of Orbit Markets, a liquidity provider for trading digital asset derivatives. Inflation figures may shape expectations about the pace of monetary easing planned by the U.S. Federal Reserve.
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