Trusted

Bitcoin Institutional Investors Trim Exposure Ahead of FOMC as BTC ETFs See Outflows

2 mins
Updated by Ann Maria Shibu
Join our Trading Community on Telegram

In Brief

  • Bitcoin ETFs saw $85.64 million in outflows, snapping a streak of inflows as institutional investors reduce exposure ahead of FOMC.
  • Despite ETF outflows, Bitcoin's spot market recorded $9.72 million in inflows, suggesting strong buying activity among individual investors.
  • Bitcoin’s price surged 2% to $96,679, driven by bullish momentum, with potential for further gains or declines based on the Fed's policy decision.
  • promo

On Tuesday, Bitcoin spot ETFs recorded net outflows, snapping a three-day streak of inflows that had brought in over $1 billion.

With uncertainty surrounding the Federal Reserve’s upcoming policy decision, institutional investors appear to be reducing their exposure in anticipation of increased market volatility.

Institutions Pull Back from BTC ETFs as Fed Decision Looms

BTC spot ETFs saw net outflows of $85.64 million on Tuesday, marking a shift in sentiment among institutional investors just ahead of today’s US Federal Reserve’s latest policy meeting.

Total Bitcoin Spot ETF Net Inflow.
Total Bitcoin Spot ETF Net Inflow. Source: SosoValue

The outflows came after three consecutive days of strong inflows, totaling over $1 billion, into these BTC-backed funds. This suggests a pullback as market participants prepare for potential volatility surrounding today’s FOMC announcement.

It can also be seen as a strategic step to avoid short-term losses in the event of an unfavorable policy signal or unexpected market reaction.

Despite the ETF outflows, on-chain data reveals a spike in spot net inflows today. This indicates that while institutional players may be reducing their ETF exposure, they could be rotating capital into direct spot positions, possibly to capitalize on short-term price swings both before and after the Fed’s announcement.

According to Coinglass, BTC’s spot net inflows sit at $9.72 million. When an asset sees spot inflows, the number of its coin or tokens purchased and moved into spot markets has increased, indicating rising demand. 

BTC Spot Inflow/Outflow
BTC Spot Inflow/Outflow. Source: Coinglass

This points to surging accumulation among BTC spot market participants, a trend which can drive price appreciation if buying pressure remains. 

Bitcoin Rises on Buyer Strength

BTC trades at $96,679 at press time, noting a 2% surge over the past day. The coin’s positive Balance of Power (BoP) reflects the steady rise in spot buying activity ahead of the FOMC meeting. As of this writing, this is at 0.10.

This indicator measures the strength of buyers versus sellers by comparing the closing price to the trading range over a specific period. When its value is positive, buyers dominate the market, suggesting bullish momentum and upward pressure on an asset’s price.

If BTC demand rockets and market conditions remain favorable post-FOMC meeting, it could climb toward $102,080. 

BTC Price Analysis
BTC Price Analysis. Source: TradingView

However, if market volatility triggers a move to the downside, BTC could shed recent gains, breach support at $96,187, and fall to $92,048.

Best crypto platforms in Europe
eToro eToro Explore
YouHodler YouHodler Explore
Wirex Wirex Explore
Arkham Arkham Explore
Best crypto platforms in Europe
eToro eToro Explore
YouHodler YouHodler Explore
Wirex Wirex Explore
Arkham Arkham Explore
Best crypto platforms in Europe
eToro eToro
YouHodler YouHodler
Wirex Wirex
NEXO NEXO
Arkham Arkham

Disclaimer

In line with the Trust Project guidelines, this price analysis article is for informational purposes only and should not be considered financial or investment advice. BeInCrypto is committed to accurate, unbiased reporting, but market conditions are subject to change without notice. Always conduct your own research and consult with a professional before making any financial decisions. Please note that our Terms and ConditionsPrivacy Policy, and Disclaimers have been updated.

Untitled-1.png
Abiodun Oladokun
Abiodun Oladokun is a Technical and On-Chain Analyst at BeInCrypto, where he specializes in market reports on cryptocurrencies from diverse sectors, including decentralized finance (DeFi), real-world assets (RWA), artificial intelligence (AI), decentralized physical infrastructure networks (DePIN), Layer 2s, and meme coins. Previously, he conducted market analysis and technical assessments of various altcoins at AMBCrypto, utilizing on-chain analytics platforms like Messari, Santiment...
READ FULL BIO
Sponsored
Sponsored