BlackRock's Bitcoin ETF saw no new investments for the third day in a row. This is in sharp contrast to other Bitcoin ETF investment products, which saw significant outflows totaling $328 million.
iShares Bitcoin Trust (IBIT) had been performing well for 71 consecutive days with continued inflows until this recent trend of zero new investments.
Explaining BlackRock's Zero Inflow
The current zero-flow trend has led some community members to interpret this as an indication of declining investor interest in Bitcoin. But Bloomberg ETF analyst James Seifert explained that this pattern is common to the broader ETF market.
Zero flows appear when there is no significant difference between the demand and supply of an ETF. Seifert said the gap must be large enough to trigger the creation and redemption of ETF shares, a process carried out on a unit-by-unit basis.
Market makers intervene in the underlying market only when the divergence exceeds a certain threshold.
“Minor discrepancies cause market makers to trade the same way they trade stocks. But it has to be biased. For market makers to exploit AP and the underlying market , it must be more than a creative unit in either direction.” Added.
Therefore, the lack of inflows into BlackRock IBIT's ETF does not imply a lack of trading activity. Rather, it indicates that the net flows are not significant enough to warrant the creation or redemption of units.
Read more: How to trade Bitcoin ETFs: A step-by-step approach
Eric Balchunas, another ETF expert at Bloomberg, also noted that iShares MSCI Emerging Markets recorded $70 billion in volume between mid-January and mid-April, despite having zero daily flows. He cited ETFEEM to support this idea.
However, the lack of inflows into BlackRock's Bitcoin ETF has affected Bitcoin prices, which have remained stagnant over the past week.
Read more: Bitcoin Price Prediction 2024/2025/2030
Crypto analyst Skew said Bitcoin remains within a defined range between $72,000 and $61,000, with a point of correction (PoC) or midrange pivot at $66,000. he pointed out.Analyst highlighted We continue to observe specific interest rate levels at the March low of $61,598 and the previous week's low of $63,498.
“PoCs are often trend inflection points, so backtesting from the top and retesting from the bottom can be contextually important. This leads to the next move, which means you can't respectfully auction for a higher or lower value. 'flow is often a good confirmation to exit or enter a trade,'' Skew explained.
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