On January 2, BlackRock’s iShares Bitcoin Trust (IBIT) experienced record-high outflows, with $333 million withdrawn in a single day, according to data from Farside Investors. This marks the largest outflow ever reported for the spot Bitcoin exchange-traded fund (ETF).
Alex Obchakevich, founder of Obchakevich Research, attributed the significant outflows to early-year profit-taking. “At the end of the year, investors and funds often review their investment portfolios, which can lead to the sale of some shares,” Obchakevich explained.
Broader Trends in Spot Bitcoin ETFs
The outflows weren’t limited to IBIT. U.S.-based spot Bitcoin ETFs collectively saw $248 million in withdrawals on January 2. Alongside IBIT, the Grayscale Bitcoin Trust (GBTC) also reported $23 million in outflows, making it the second-largest loser in net capital flows.
Isaac Joshua, CEO of token launch platform Gems, pointed to tax-loss harvesting as a contributing factor. “Many have liquidated both Bitcoin ETFs and the underlying asset itself to optimize their tax reports,” Joshua noted, emphasizing that this is a common financial strategy at the turn of the fiscal year.
Investor Optimism Remains High
Despite the recent outflows, investor sentiment around BlackRock’s Bitcoin ETF remains positive. Ryan Lee, chief analyst at Bitget Research, highlighted the ETF’s pivotal role in driving institutional adoption of Bitcoin. “BlackRock’s Bitcoin ETF simplifies access for institutional investors, enhancing legitimacy and facilitating mainstream acceptance,” Lee wrote in a recent note.
The iShares Bitcoin Trust has already made history by surpassing $50 billion in assets under management within 228 days of its launch—achieving this milestone more than five times faster than any other ETF in history.
Isaac Joshua further noted that by bridging traditional finance and cryptocurrency, IBIT is expected to stabilize Bitcoin’s market perception and potentially reduce price volatility.
Bitcoin Price Update
As of press time, Bitcoin is trading at $96,700, reflecting a 0.11% gain over the past 24 hours and a 0.35% increase over the last seven days. The current price is 10.7% below its all-time high of $108,300 recorded on December 17, 2024.
While BlackRock’s Bitcoin ETF faces record outflows due to profit-taking and tax strategies, its groundbreaking growth and impact on institutional adoption keep investor optimism intact. As Bitcoin’s integration with traditional finance deepens, products like IBIT are poised to shape the future of cryptocurrency markets, potentially offering long-term stability and broader acceptance.