BlackRock Bitcoin Fund Suffers Record $333 Million as Price Declines

Bitcoin’s incredible rally in 2024 paused as
institutional investors reduced their positions. BlackRock’s iShares Bitcoin
Trust ETF (IBIT), a spot Bitcoin fund, reported its biggest single-day outflow
since its launch, with $333 million withdrawn yesterday (Thursday), according
to Bloomberg data.

Third Consecutive Day of Outflows

The withdrawal marked the third straight day of
outflows for the fund, highlighting a shift in sentiment. IBIT, which launched
in January, had become popular among institutional investors, a factor that
pushed Bitcoin to a record high of $108,315 in mid-December.

However, by year-end, the once unstoppable fund began
to lose momentum. The decline in IBIT’s inflows reflects a broader trend across
the cryptocurrency sector.

[BREAKING] #BlackRock’s iShares Bitcoin Trust (IBIT) saw a record outflow 🔴$332.6M (-3,413 BTC) on the first trading day of 2025!This surpassed the ETF’s previous low of $188.7M (-1,933 BTC) on December 24, 2024.In 2024, BlackRock saw cumulative inflows of $37.2B for its… pic.twitter.com/CGQhI3niKb

— Spot On Chain (@spotonchain) January 3, 2025

Since December 19, Bitcoin-focused exchange-traded
funds in the U.S. have reportedly recorded net outflows of approximately $2
billion. Additionally, open interest in Bitcoin futures on the Chicago-based
CME Group fell nearly 20% from its December peak.

This decline in outstanding contracts, often used to
gauge institutional demand, represents a shift in market dynamics as investors
reassess their risk exposure.

Year-End Portfolio Adjustments

Market analysts attribute the outflows to year-end
portfolio adjustments by institutional investors. These adjustments come as
Bitcoin trades nearly 11% below its December high, at $96,423 today (Friday).

While significant, the pullback is not unusual
following a year of explosive gains for the cryptocurrency. Despite the record
outflows, BlackRock has reportedly not issued a statement regarding the trend. Bitcoin’s retreat, coupled with reduced institutional
activity, suggests the digital asset’s meteoric rise in 2024 may face a more
measured pace in the months ahead.

Expect ongoing updates as this story evolves.

This article was written by Jared Kirui at www.financemagnates.com.
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