Inflows of Bitcoin ETFs return after the abysmal phase

Outflows from bitcoin ETFs over the past couple of months have suggested strong bearish sentiment among institutional investors. However, there appeared to be a shift in the tide last week when there was a noticeable trend in influx over a three-day period. These inflows into BTC ETFs providing long exposure showed investors were expecting further upside for the digital asset and the decline in short exposure to BTC is telling the truth.

ProShares outflows and inflows

ProShares Bitcoin ETFs are the most popular on the market. The BITO ETF offers long exposure, while the newer BITI ETF allows investors to capitalize on short exposure. BITI, having launched into a bear market, has grown rapidly in terms of exposure to BTC. However, the past week showed a reluctance on the part of investors to bet against the price of bitcoin.

BITI outflows for last Friday totaled 1,060 BTC in a single day period, the largest outflow recorded by the ETF since its launch. Furthermore, the outflows would continue into the new week as BITI saw another 425 BTC leave. This brought BITI’s total exposure to 3,580 BTC as of Monday.

Bitcoin ETF

BITO ETF records inflows | Source: Arcane Research


As for the BITO, there has been all shades of good news in the last week. Three consecutive days of inflows saw 1,650 BTC flowing into the ETF. This follows a month of outflows for the ETF, showing increased demand for long exposure to the digital asset.

While BITI had seen 1,050 BTC in outflows on Friday, BITO had seen 700 BTC inflows on the same day. It suggests that investors are withdrawing their short positions and putting them into long positions.

Bitcoin not out of the woods

While there have been many inflows into long bitcoin ETFs, the numbers still do not suggest a complete shift towards bullish sentiment among investors. BITI’s exposure to BTC shows that while there may be some movement towards long ETFs, bets against the bitcoin price still remain in the minds of investors.

Bitcoin price chart from TradingView.com

BTC declines to $20,000 | Source: BTCUSD on TradingView.com

BITI’s current total exposure is 3,850 BTC, the same as it was at its June and July highs. So even though there have been outflows, there is still a strong sentiment of continuing to short the digital asset.

BITO had recorded its strongest inflows in a single day Friday, but has yet to completely reverse the bearish trend. Even with such high inflows, the ETF is currently at a three-month low. However, a positive aspect of the three-day inflows was a recovery on an ECM basis.

Featured image from CryptoPotato, charts from Arcane Research and TradingView.com

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