Bitcoin ETFs recorded their largest outflow in six weeks, draining $389.7 million during the week of August 10th, according to data compiled by Bloomberg. This represents a sharp reversal from the previous week's $853.5 million inflows, marking the first significant outflow since the end of June. As reported by Business Standard, the 13 US-listed funds saw this dramatic shift in institutional sentiment, with the first week of August initially marking the largest weekly inflows since April. Bitcoin ETF flows were marginally positive for three weeks last month, but underlying sentiment remained fragile throughout this period.
According to reports from AMBCrypto, Cboe BZX Exchange filed a proposed rule change with the SEC to list and trade Volatility Shares' 3x Bitcoin ETF and 3x Ether ETF. The filing seeks approval for several leveraged commodity-based funds, including products tracking gold, silver, and crude oil. If approved, these crypto funds could become America's first triple-leveraged Bitcoin and Ethereum ETFs. Both funds would primarily use CME Bitcoin and Ethereum futures and target three times their assets' daily performance, though this leverage would reset daily. The filing was made on August 14th and represents a significant milestone for US crypto ETF markets.
Bitcoin remains stagnant around $63,550, trading within a tight 2% range as reported by Business Standard. The token has lost approximately 50% from its record high reached in October last year, with technical indicators showing Bitcoin implied volatility index at around 37, below its yearly average and well under its 82.2 peak in early February. The renewed selling pressure comes as risk of higher interest rates keeps sentiment cautious while a lack of legislative progress in the US on the proposed Clarity Act continues to push buyers to the sidelines. Recent data shows short liquidations at $11.3K, roughly double the long liquidations, indicating bears are under pressure, while spot market volume surged 70% to $5.14 million and long positions dominate at around 60%, signaling growing trader confidence.
Esme Pau, head of capital markets and policy at blockchain security firm CertiK, explained that "last week's ETF net outflows reflect the subdued mood in the Bitcoin market. The inflows seen shortly after the Coldcard hack now appear to have been an aberration, with broader institutional sentiment remaining cautious, bordering on pessimistic." The renewed selling follows a recent hack of Coldcard-branded offline wallets made by Toronto-based Coinkite Inc., which made the generation of Coldcard keys predictable and shook faith in offline storage solutions. A vulnerability affecting the generation of keys for Coldcard wallets made some keys predictable, raising concerns about the security of hardware wallets that are generally regarded as one of the safer ways to store digital assets. ETF flows are an important gauge of institutional demand because these products have emerged as one of the biggest channels through which traditional investors gain exposure to Bitcoin, with a sustained period of outflows potentially weighing on prices and liquidity if other large sources of demand remain subdued.
