Key Takeaways
- • U.S. spot crypto ETFs recorded more than $500 million in net outflows on Thursday, according to The Block, as markets reversed initial post-midterm gains.
- • Fidelity's FBTC led bitcoin ETF outflows with $199.9 million, followed by BlackRock's IBIT at $105 million and Grayscale's GBTC at $49.9 million.
- • Major U.S. crypto ETFs have seen combined net outflows exceeding $1.1 billion so far this week.
- • Bitcoin fell 5.6% and Ether fell 7.8% on Thursday, as the Nasdaq Composite dropped 5.5% and the S&P 500 fell 4.4% amid concerns over AI infrastructure spending and Democratic control of Congress.
- • More than $1 billion in leveraged crypto positions were liquidated within 24 hours, per the report.
Summary
U.S. spot crypto exchange-traded funds recorded more than half a billion dollars in net outflows on Thursday, after markets reversed initial gains that followed the U.S. midterm elections, according to The Block. Among bitcoin products, Fidelity's FBTC led the outflows with $199.9 million, followed by BlackRock's IBIT with $105 million and Grayscale's GBTC with $49.9 million. Franklin Templeton's EZBC, VanEck's HODL and Ark Invest's ARKB also posted net outflows, while the remaining bitcoin ETFs reported zero flows for the day.
Ethereum funds also saw heavy redemptions. The Block's source material cites BlackRock's ETHA and ETHB as leading the outflows, with figures of $75.2 billion and $22 billion, respectively; these amounts appear inconsistent with typical fund sizes and should be verified against primary flow data before use. Fidelity's FETH and Grayscale's ETHE also recorded outflows. Smaller altcoin products were weaker still, with U.S. Solana ETFs seeing a combined $1.2 million in net outflows, Zcash ETFs $11 million and Hyperliquid ETFs $3 million, per SoSoValue data. XRP ETFs were the only exception, with zero flows. Major U.S. crypto ETFs have now recorded a combined net outflow of more than $1.1 billion so far this week.
The price action mirrored a broader risk-off move. Bitcoin fell 5.6% on Thursday, more than erasing a 4% gain on Wednesday, while Ether dropped 7.8% and the GMCI 30 index declined 6.4%. The Nasdaq Composite fell 5.5% and the S&P 500 dropped 4.4% as investors weighed the potential impact of restrictions on AI infrastructure buildout following the Democratic sweep of the House and Senate. Kyle Rodda, senior financial market analyst at Capital.com, said the political risks arrived when the AI trade already rested on shakier foundations, citing disappointing earnings and signs of slowing AI spending. Axel Rudolph, chief technical analyst at IG, told The Block that bitcoin had been "dragged into the AI rout" through its correlation with technology stocks, and that more than $1 billion in leveraged crypto positions were liquidated within 24 hours.
Attention now turns to Friday's U.S. jobs report, which could add further pressure if it strengthens the case for Federal Reserve rate increases. Economists expect roughly 60,000 to 65,000 new jobs, according to Daniela Hathorn, senior market analyst at Capital.com, who warned that stronger wage growth could push Treasury yields and the dollar higher. André Dragosch, head of research for Europe at Bitwise, nonetheless expects bitcoin to outperform U.S. equities as the AI trade unwinds, noting that bitcoin is currently more sensitive to the dollar and monetary policy expectations than to economic growth, and could decouple from stocks if financial conditions improve.
Ethereum funds also saw heavy redemptions. The Block's source material cites BlackRock's ETHA and ETHB as leading the outflows, with figures of $75.2 billion and $22 billion, respectively; these amounts appear inconsistent with typical fund sizes and should be verified against primary flow data before use. Fidelity's FETH and Grayscale's ETHE also recorded outflows. Smaller altcoin products were weaker still, with U.S. Solana ETFs seeing a combined $1.2 million in net outflows, Zcash ETFs $11 million and Hyperliquid ETFs $3 million, per SoSoValue data. XRP ETFs were the only exception, with zero flows. Major U.S. crypto ETFs have now recorded a combined net outflow of more than $1.1 billion so far this week.
The price action mirrored a broader risk-off move. Bitcoin fell 5.6% on Thursday, more than erasing a 4% gain on Wednesday, while Ether dropped 7.8% and the GMCI 30 index declined 6.4%. The Nasdaq Composite fell 5.5% and the S&P 500 dropped 4.4% as investors weighed the potential impact of restrictions on AI infrastructure buildout following the Democratic sweep of the House and Senate. Kyle Rodda, senior financial market analyst at Capital.com, said the political risks arrived when the AI trade already rested on shakier foundations, citing disappointing earnings and signs of slowing AI spending. Axel Rudolph, chief technical analyst at IG, told The Block that bitcoin had been "dragged into the AI rout" through its correlation with technology stocks, and that more than $1 billion in leveraged crypto positions were liquidated within 24 hours.
Attention now turns to Friday's U.S. jobs report, which could add further pressure if it strengthens the case for Federal Reserve rate increases. Economists expect roughly 60,000 to 65,000 new jobs, according to Daniela Hathorn, senior market analyst at Capital.com, who warned that stronger wage growth could push Treasury yields and the dollar higher. André Dragosch, head of research for Europe at Bitwise, nonetheless expects bitcoin to outperform U.S. equities as the AI trade unwinds, noting that bitcoin is currently more sensitive to the dollar and monetary policy expectations than to economic growth, and could decouple from stocks if financial conditions improve.
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