Bitcoin ETFs Experience Heavy Outflows Ahead of Election Day

• Massive Bitcoin ETF outflows suggest caution as markets await Election Day outcomes.
• Bitcoin price volatility rises as ETFs face record outflows, FOMC decision looms.
• Election-driven market shifts could drive Bitcoin toward $90,000 or plunge to $50,000.

US spot Bitcoin ETFs saw massive outflows on November 4th, with investors withdrawing $541 million in a single day. This marks the second-largest single-day outflow since these funds launched, just behind the $563 million outflow on May 1st.

Fidelity’s FBTC fund was hit particularly hard, with $170 million in withdrawals, its second-biggest daily outflow ever. These large outflows raise concerns about investor confidence in the crypto market leading up to Election Day and other important economic events.

Major Outflows Across Bitcoin ETFs

In addition to Fidelity, other major Bitcoin ETFs also saw substantial losses. Ark Invest’s ARKB and Bitwise’s BITB had their worst single-day performances, with outflows of $138 million and $80 million, respectively. Grayscale’s BTC fund lost $89 million, while its GBTC fund had another $64 million in outflows.

Franklin Templeton, VanEck, and Valkyrie funds collectively lost over $38 million. However, BlackRock’s IBIT fund gained about $38 million in net inflows, showing resilience despite the broader ETF selloff. WisdomTree’s BTCW and Invesco’s BTCO funds had no flows, remaining stable.

Bitcoin Dips as Markets Anticipate Economic and Political Events

Bitcoin’s recent price drop adds to the pressure on these ETFs. After trading near its all-time high, Bitcoin fell below $70,000 last Friday, breaking a seven-day winning streak. Over the weekend, it dropped to $67,300, continuing its decline.

Bitcoin is still up overall since the Federal Reserve’s 50 basis-point rate cut on September 18th. At present, Bitcoin is trading around $68,865.95, up 0.40% in the last 24 hours. This pullback has impacted the broader crypto market, with Ethereum and Solana both down over 1%, and Toncoin and Chainlink each losing 4%.

Election Day and FOMC Meeting Heighten Volatility Concerns

With Election Day and the Federal Open Market Committee (FOMC) meeting approaching, markets are preparing for increased volatility. Analysts believe a “sell-the-news” reaction could occur, where major events trigger short-term sell-offs.

Historically, Bitcoin has often seen significant gains in the year after US presidential elections, as observed after the 2012, 2016, and 2020 elections.

Read also: Bitcoin ETFs See Record $870M Inflows as Trump’s Election Odds Hit 66.5%

However, short-term price action may depend on the election results. Some analysts predict that a Trump victory could push Bitcoin towards $90,000, while a win for Harris might send it down to $50,000.