Bitcoin ETFs Draw In $222M, Snapping 10-Day Losing Streak

U.S. spot Bitcoin ETFs returned to net inflows on Thursday, snapping a 10-day losing streak, as a weak jobs report and softer signals from the Federal Reserve eased pressure on risk assets.

The funds pulled in $221.7 million, their largest daily haul in about two months, according to data from SoSoValue. Fidelity’s FBTC led with $166 million, followed by ARKB at $91.8 million and VanEck’s HODL at $4.4 million. BlackRock’s IBIT was the exception, shedding $40.4 million to extend a losing run dating to mid-June.

The inflow ended a stretch that drained about $2.7 billion from the funds and closed out a miserable June, the worst month on record for U.S. spot Bitcoin ETFs, which bled around $4.5 billion. Bitcoin, which fell to a 21-month low below $58,000 earlier in the week, had since climbed back above $61,000, per CoinGecko data.

Rate fears ease

The catalyst was a softer read on the U.S. economy and a shift in tone at the Fed. The government’s June jobs report showed just 57,000 nonfarm payrolls added, well below the roughly 110,000 forecast, while Fed Chair Kevin Warsh signaled that inflation risks had eased, cooling bets on further rate hikes and pulling the dollar back.

Warsh’s comments “improved overall market sentiment,” driving inflows to Bitcoin ETFs and sparking Bitcoin’s rebound over $61,000, Andri Fauzan Adziima, research lead at Bitrue Research Institute, told Decrypt. Adziima added that “the same positive shift is now supporting renewed flows into Ethereum ETFs as well,” with the products posting inflows of $14.9 million Wednesday and $29.1 million Thursday, per SoSoValue.

Tim Sun, senior researcher at HashKey, tied the turn to “the marginal shift in interest rate expectations.” Persistent outflows, he said, had reflected the market’s “pricing-in of further rate hikes,” which lifted the dollar and real yields against non-yielding Bitcoin, while the weak payrolls print has been “weakening the market’s anticipation of further rate hikes.”

Not a reversal yet

Sun cautioned that the bounce is “only a temporary recovery after the easing of interest rate pressure” with a trend reversal as yet unconfirmed. Bitcoin’s path is still “constrained by changes in the U.S. dollar, real interest rates, and Federal Reserve policies,” he added.

Stephen Wundke, strategy and revenue director at Algoz Technologies, saw bargain-hunters buying oversold assets after a flight to safety that hit even gold, with investors crowding into Treasury bills. Falling five-year yields and oil prices, he added, signal inflation coming back under control, while those investors “looking for a BTC bottom or recognising oversold assets started to bottom fish.” Bitcoin may “bounce around the bottom for a few more weeks,” he said, “but the direction of travel is clear to see.”

On prediction market Myraid, owned by Decrypt‘s parent company Dastan, users remain bearish on that direction. They put the chances of Bitcoin’s next move taking it to $55,000 rather than $84,000 at 74%, roughly the same as a week ago.