Bitcoin (BTC) exchange-traded funds (ETFs) experiencing days without any new investments should not be seen as a failure of the products, according to James Seyffart, an ETF analyst at Bloomberg. Seyffart stated that it is common for most ETFs in any sector to have days with zero inflows. He explained that for an ETF to record new inflows or outflows, there needs to be a significant mismatch between supply and demand that justifies the creation or redemption of new fund shares. These shares are issued in “creation units,” which can vary in size depending on the ETF. Recent data showed that several Bitcoin ETFs in the US experienced net outflows, with the Grayscale Bitcoin Trust (GBTC) having the highest selling activity. These outflows coincided with a period of price decline for Bitcoin and increasing geopolitical tensions in the Middle East. Despite these factors, Seyffart emphasized that the lack of inflows should not be a cause for concern.
Unveiling the True Meaning Behind Bitcoin ETFs with 'Zero Flows'