Bitcoin ETFs experienced a staggering $2.7 billion in outflows this week, implying an oncoming bear market. The pain is palpable among corporate Bitcoin holders as liquidations surge throughout the crypto industry.
Adding to the gloom, the Federal Reserve Bank of Atlanta's projection suggests a 1.5% decrease in US GDP for Q1 2025, intensifying economic concerns.
Is Bitcoin Bracing for a Bear Market?
The US spot Bitcoin ETF market, which initially flourished, is now witnessing significant outflows. This recent week marked a record-breaking outflow nearing $1 billion, portraying escalating worries among institutional investors.
In the past week alone, Bitcoin ETFs recorded net outflows of $2.7 billion, hinting at a looming bear market. This marks the largest weekly net outflow since March 2024.
Fear of an impending bear market grips the entire crypto sphere, impacting even corporate Bitcoin holders. Despite Strategy's (formerly MicroStrategy) substantial BTC investment of nearly $2 billion, its stock price has plummeted by 57% since last November. Similarly, Metaplanet saw a 54% decline from its peak, and Tesla's value is sliding downwards, all major holders of Bitcoin.
While Bitcoin appears to be bearing the brunt of this potential bear market, liquidations are soaring across the crypto sector. Recent data reveals almost $1 billion liquidated in the past 24 hours, reflecting a sentiment of Extreme Fear among traders, reminiscent of the 2022 FTX collapse.
Renowned personalities like Michael Saylor advise against panic selling, urging followers to "sell a kidney if you must, but retain the Bitcoin." Meanwhile, Arthur Hayes, former BitMEX CEO, tweaks his prior projection of a BTC drop, anticipating a rebound after the bear market phase.
Dark economic forecasts have loomed for some time now, hinting at an inevitable market correction. This afternoon, the Federal Reserve Bank of Atlanta projected a 1.5% dip in US GDP for Q1 2025, further painting a bleak economic outlook.
With various macroeconomic indicators pointing towards a short-term bearish trend for Bitcoin and the broader market, every move in the crypto space is under intense scrutiny.