BlackRock has made one of the largest crypto moves this year, with outflows worth $980 million worth of Bitcoin on Tuesday, September 23, according to the latest data retrieved by Finbold from Arkham.
While the numbers are staggering, the timing of the transfers were also noteworthy, as Bitcoin has been experiencing heightened volatility this week.
As a result, traders are speculating whether another wave of institutional sales is underway now that the broader crypto market is taking a hit as a result of shifting global monetary policy.
At the time of writing, the cryptocurrency is trading below $113,000, up 0.49% on the daily but still down 2.20% on the weekly chart.
While the market might be speculating about the future, BlackRock is still the biggest crypto fund, commanding over $87.5 billion worth of BTC.
Moreover, outflows from its iShares Bitcoin Trust (IBIT) on Arkham do not mean BlackRock is speculating or dumping coins at will.
Rather, spot Bitcoin ETFs like IBIT work through a creation and redemption process with authorized participants (APs). When investors sell ETF shares, APs redeem those shares, currently on a cash-settled basis, which requires the trust to sell Bitcoin and send cash back.
That’s what shows up as an “outflow” on Arkham: Bitcoin leaving the custodian wallet (Coinbase) to meet redemptions. Likewise, when demand rises, inflows happen as new ETF shares are created and Bitcoin is purchased.
Ethereum ETFs also see major outflows
Spot Ethereum exchange-traded funds (ETFs) also saw substantial outflows, bleeding $76 million on Monday, September 22, with BlackRock alone being responsible for $15.1 million.
The timing is once again notable, as the sales came just days after BlackRock’s $500 million buying spree and an overall $1.9 billion in net inflows last week following the Fed’s 25 basis-point rate cut.
Bitcoin funds led with $977 million in inflows, extending their four-week tally to nearly $4 billion. Ethereum, on the other hand, added $772 million, lifting its year-to-date total to around $12.6 billion.
The pressure is now also increased by the U.S. Securities and Exchange Commission’s (SEC) new listing standards for NASDAQ, Cboe, and NYSE. These have slashed the approval times for spot crypto ETFs from over 200 days to as little as 75, which is likely to turn eyes toward potential new launches, including Solana ETFs.
Featured image via Shutterstock
