Bitcoin funds have been bleeding coins in the wake of the U.S. Federal Reserve’s unexpected hawkish tilt.
- Data tracked by ByteTree Asset Management shows the number of coins held by the U.S. and Canadian closed-ended funds and Canadian and European exchange-traded funds (ETFs) fell to 782,558 BTC (worth $28.72 billion) on Friday, the lowest since Feb. 25.
- Holdings have declined by over 15,000 in the past three days alone.
- On Wednesday, the Federal Reserve surprised markets with a hawkish turn, bringing forward the timing of its next interest rate hike to 2023.
- Since then, most assets, including bitcoin, have faced selling pressure, although the leading cryptocurrency has remained relatively resilient compared to most fiat currencies and gold.
- Fund holdings peaked above 815,000 BTC in mid-May, having risen by over 300,000 BTC since October.
- The May peak coincided with the bitcoin’s drop from $58,000 to nearly $30,000.
- “BTC held by ETFs and funds are a significant and measurable sample of network demand,” ByteTree CIO Charlie Morris told CoinDesk. “Heavy institutional buying last October led to a price surge, which cooled in the second quarter this year.”