What to Know
- In the last trading session, spot Bitcoin ETF products saw an outflow of $104 million.
- BTC price could suffer significantly if it loses hold on the $112,000 level.
- However, companies like Strategy, Metaplanet, and others are still aggressively accumulating BTC.
On September 23, spot Bitcoin exchange-traded funds (ETFs) recorded major withdrawals with over $104 million in net outflows. According to SoSoValue data, institutional interest in investing in Bitcoin via ETFs experienced a backlash, as the Fidelity FBTC fund ranked first in outflows.
Bitcoin ETF Outflow Data
The FBTC Bitcoin ETF by Fidelity registered the highest one-day outflow, standing at a total of $75.56 million, which is equivalent to approximately 675.92 BTC leaving the fund. The drastic cut positioned FBTC in the number one position in the daily outflow list.
Other huge outflows were seen in the ARK 21Shares ARKB Bitcoin ETF, where it registered outflows of $27.85 million, which reflected 249.15 BTC leaving the vehicle. BITB ETF of Bitwise also lagged behind with a net redemption of 12.76 million, which is 114.18 BTC.
Meanwhile, BlackRock iShares Bitcoin Trust (IBIT) was an exception, attracting inflows of $2.54 million. Moreover, Invesco BTCO ETF was one of the strongest in the day as it recorded a positive inflow of $10.02 million, equivalent to 89.66 BTC being added to its holdings.
The smaller issuers, such as VanEck funds HODL, Valkyrie funds BRRR, Grayscale funds GBTC and BTC, and Franklin Templeton’s EZBC, had no activity on the day. The divergence in investor mood is emphasized by the mixed flows among the large issuers, with Bitcoin trading just over the $112,000 mark.
Bitcoin Market Under Liquidation Pressure
According to the current market statistics, the price of Bitcoin stands at $112,599 with a 24-hour trading volume of nearly $48 billion. The overall market cap of BTC currently stands above the $2.25 trillion mark and is firmly positioned as the market leader in the digital asset industry, despite ETF outflows.
Although spot ETF trading is indicative of immediate investor positioning, derivatives indicate high risks. As per CoinGlass figures, there are over $12.5 billion leveraged Bitcoin positions that could be liquidated at the moment. According to analysts, a relatively small drop of 5% in the Bitcoin price will create a forced sale on a massive scale.
According to the liquidation map, the highest proportion of exposure is included in Binance, with about $4.8 billion of open interest being sensitive. Bybit comes next with $2.7 billion, and billions of at-risk contracts are also held by OKX.
Market observers make comparisons to previous bouts of liquidation crashes. In May 2021, Bitcoin price fell by over 12% within a single trading session, destroying close to $10 billion worth of leveraged bets. According to research published in the Journal of Risk and Financial Management in 2022, leverage can contribute to increased volatility of the price of Bitcoin by 30-40%, increasing market volatility during periods of decline.
Key technical levels:
- Bitcoin price trades below the 200-EMA at $113,450, which is a critical level that bulls need to reclaim.
- Resistance levels lie at $115,500, $116,150, and $118,000.
- Immediate supports are found at $112,500, $110,850, and $108,750.
A breakdown below $112,000 could lead to a massive downfall, as indicated in the liquidation heatmap. However, on the upside, if the BTC price reclaims $114,000, it could see a recovery to the $120,000 level.
Continuing Institutional Accumulation of BTC
Despite the imminent risk of a domino liquidation and Bitcoin ETF outflows, corporate BTC treasury plans remained steadfast. Strategy, led by Michael Saylor, has announced that it has bought 850 BTC at an estimated cost of $99.7 million, and now has a total of 639,835 BTC. The stash of the company has been estimated to be valued at about $47.3 billion at the existing market prices.
In Japan, Metaplanet announced buying Bitcoin worth $632 million, which added up to 25,555 BTC, which is worth almost $3 billion. After merging with Semler Scientific, Strive invested $675 million in Bitcoin, now holding little over 10,900 BTC in its balance sheet.
Also Read: Bitcoin Treasury Firm Fold Partners Stripe, Visa for BTC Credit Card
