Massive BlackRock Bitcoin ETF Outflow Breaks 31-Day Streak

Get ready for a significant shift in the crypto market news. BlackRock’s iShares Bitcoin Trust (IBIT), a major player in the Bitcoin ETF space, just hit a notable milestone – but not the kind tied to inflows. After a remarkable run, IBIT recorded its largest ever single-day outflow, ending a prominent streak and impacting the overall spot Bitcoin ETF landscape.

BlackRock IBIT’s Streak Ends with Record Outflow

For 31 consecutive trading days, BlackRock’s IBIT saw money flowing in, a testament to strong investor interest since its launch in January 2024. However, that impressive streak concluded abruptly on May 30. Data from Farside reveals that IBIT experienced a massive ETF outflow totaling $430.8 million on that day. This figure surpasses its previous largest outflow day ($418.1 million on Feb. 26) by nearly $12.7 million.

This event drew commentary from industry observers. ETF analyst Nate Geraci noted the significance of the prior inflow streak, stating, “What a run over the past 30+ days, though.” He also highlighted BlackRock’s substantial Bitcoin holdings, now nearing $70 billion since the ETF’s inception, calling the growth “ridiculous.”

Wider Impact: Overall Spot Bitcoin ETF Outflows

The significant outflow from BlackRock IBIT contributed to a broader trend across the US spot Bitcoin ETF market. May 30 marked the second consecutive day of net outflows for the group of 11 ETFs. The total net outflows for the day reached $616.1 million.

This followed a net outflow of $346.8 million on May 29, which had ended the cohort’s own 10-day net inflow streak. Interestingly, on May 29, BlackRock’s IBIT still posted an inflow, even as most other issuers saw outflows, a point that Master Ventures founder Kyle Chasse highlighted, suggesting it showed “big brain energy.”

Despite these recent outflows, the overall picture for US spot Bitcoin ETFs since their January launch remains strongly positive, with accumulated net inflows totaling $44.35 billion.

Understanding the Outflows: Not Just Retail Panic?

Regarding the nature of these outflows, Kyle Chasse suggested they might not indicate widespread panic among smaller retail investors. He commented, “The sell-off isn’t retail panic. It’s literally the quiet transfer of supply to the strongest hands.” This perspective implies that larger, more strategic players might be responsible for the recent selling pressure.

Market Context: Bitcoin Price Reaction

Amidst these significant ETF movements, the crypto market has seen some price volatility. While Bitcoin was up over 9% in the month leading up to these outflows, its spot price saw a decrease of over 2% in the 24 hours following the large BlackRock outflow day.

Derive founder Nick Forster also pointed out an interesting dynamic: the recent large inflows into spot Bitcoin ETFs hadn’t translated into a proportionate rise in Bitcoin’s spot price. He noted, “Despite significant inflows into Bitcoin ETFs, notably over $6.2 billion into BlackRock’s iShares Bitcoin Trust in May, Bitcoin’s price hasn’t experienced a commensurate rise.” This suggests other market forces may be influencing price action, or that ETF flows have a more complex relationship with immediate price movements than some might expect.

Summary

BlackRock’s IBIT ending its impressive 31-day inflow streak with a record-breaking $430.8 million outflow is a notable event in the Bitcoin ETF landscape. This contributed to overall net outflows for US spot Bitcoin ETFs for two consecutive days. While some see this as a potential shift in institutional activity, others suggest it’s a transfer of assets rather than panic selling. The impact on the Bitcoin price has been relatively modest compared to the scale of the ETF flows, highlighting the complexity of the current crypto market dynamics.