A recent surge of outflows from BlackRock’s Bitcoin ETF, the iShares Bitcoin Trust (IBIT), totaling a staggering $188.7 million on Christmas Eve, has left many investors pondering if BTC’s dominance is under threat. This significant outflow encapsulates a larger pattern, with Bitcoin funds shedding a total of $1.5 billion just between December 19 and December 24. This wasn’t an isolated incident, as other prominent ETFs, including those from Fidelity and ARK 21Shares, also experienced notable withdrawals. Interestingly, the Bitwise Bitcoin ETFs managed to attract some inflows amidst this turbulent backdrop.
As these declines unfold, altcoins are beginning to step into the spotlight. The Ethereum ETFs are experiencing a steady rise in trader interest, showing inflows of $53.6 million, heightened by a remarkable $130.8 million on the previous day. This shift in focus indicates that Bitcoin might be losing its grip, leading some analysts to speculate that Ethereum could outshine Bitcoin in the upcoming January 2025.
Despite these shifts, Bitcoin has shown signs of resilience, with its price recently bouncing back from $94,000 to around $98,000, reflecting what some are calling a “Santa Claus rally.” However, caution looms as trading volume has dropped significantly, which suggests that some traders might be opting for profit-taking instead of outright bullish moves.
But what about the outlook for Bitcoin? The recent outflows from BlackRock’s ETF and the broader trend of withdrawals have put investors in a reflective mood. Crypto analysts, such as Skew, note that the market’s passive ask liquidity hovers around $100,000, with keen eyes on the $105,000 price point. Analysts believe major entities may be preparing for higher price movements as we step into a new year.
Traders are recommended to keep a close watch on the interplay between volume and sentiment, especially with significant BTC options nearing expiration, which adds an extra layer of unpredictability. The current wave of outflows and changing dynamics suggest Bitcoin’s dominance might be tested. Only time will reveal the direction this market will take, making it an exciting and unpredictable space to watch.
