Bitcoin’s price actions in the past few days have been nothing short of a substantial correction that pushed it south by around thirteen grand.
It seems Powell’s comments made during the latest FOMC meeting have scared US investors as they pulled over $670 million from the spot Bitcoin ETFs within just a day.
After slashing the key interest rates by another 25 basis points, Fed Chair Powell warned that 2025 might not see as many reductions due to the alarming numbers on the inflation front. To make things worse for BTC and the altcoins, he added that the central bank is not allowed to buy and store bitcoin for itself, which contrasts with one of Donald Trump’s many pro-crypto promises.
The effects were immediate as the primary cryptocurrency’s price tumbled from over $105,000 to $98,000 immediately on Wednesday evening. After jumping to almost $103,000 on Thursday, the bears resumed control of the market and pushed it south to a multi-day low of under $96,000, leaving over a billion in liquidations.
This came during the US trading hours. Data from FarSide indicates that US investors indeed got scared for their allocations into riskier assets like BTC and started to pull funds out of the Bitcoin ETFs. In fact, December 19 turned out to be the worst day in terms of daily outflows in the ETFs’ nearly year-long history.
$671.9 million was withdrawn from the financial vehicles in total, with Fidelity’s FBTC and Grayscale’s BTC leading the pack – $208.5 and $188.6 million, respectively.
Even BlackRock’s IBIT, which continues to shatter records, couldn’t attract any fresh funding but at least didn’t see any major withdrawals, ending the day at $0.0.
The spot Ethereum ETFs were on a roll for nearly a month, as they didn’t see a single net outflow day since November 21. However, the landscape around them changed as well, with investors pulling $60.5 million.
Although the amount is more than 10 times lower than that of the Bitcoin ETFs, ETH’s price wasn’t spared. The asset is down by over 9% in the past day and struggles at $3,350 after its latest rejection at $4,000.