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Bitcoin dips below $58,000 after record daily ETF sell-off

Bitcoin dipped below $58,000 on Wednesday.
Bitcoin dipped below $58,000 on Wednesday. (John Keeble via Getty Images)

Bitcoin (BTC-USD) has dipped below $58,000 (£46,339) after Wednesday saw a record $563m spot bitcoin exchange-traded fund (ETF) sell-off. This followed on from a trend developing throughout April, which marked the first month of net outflows from spot bitcoin ETFs since their launch on 11 January.

Fidelity Wise Origin Bitcoin Fund (FBTC) led the way with outflows of over $191m, according to data sourced from Farside Investors. This was followed by Grayscale's Bitcoin Trust ETF (GBTC), with more than $167m; ARK 21Shares Bitcoin ETF (ARKB) with more than $98m; and BlackRock's iShares Bitcoin Trust (IBIT) nearly $40m.

Other spot bitcoin ETF funds also bled money even though US Federal Reserve chair Jerome Powell ruled out further rate hikes in Federal Open Market Committee (FOMC) meeting on Wednesday.

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Read more: Crypto live prices

The FOMC did what the majority of analysts predicted and held the benchmark federal funds rate in the current range of between 5.25% and 5.50%. "In support of its goals, the committee decided to maintain the target range for the federal funds rate at 5.25% to 5.50%," the central bank said in a statement.

Read more: What is a spot bitcoin ETF and why it has sparked a crypto rally?

Regarding the possibility of a rate cut, the central bank said that "the committee does not expect it will be appropriate to reduce the target range until it has gained greater confidence that inflation is moving sustainably toward 2%".

Signs of a monetary policy loosening came after the FOMC announced it would start reducing quantitative tightening in June. Meanwhile, the US Treasury unveiled a programme to repurchase billions of dollars in government debts for the first time in over two decades, aiming to enhance liquidity in the bond market.

Read more: Bitcoin ETFs poised for US pension plan inflows, Standard Chartered analyst says

Bitcoin is responsive to anticipated shifts in liquidity conditions and has experienced a muted rally in the past hour. Other crypto majors, such as ether (ETH-USD) and Solana (SOL-USD) have increased 0.3% and 0.6% also in the past hour, according to Coingecko data.

According to Yahoo Finance senior markets reporter Jared Blikre, the largest digital asset by market cap (BTC-USD) could make a further move upwards.

"The current charts looks like bitcoin is exhibiting a bull flag before the resumption of an overall trend upwards," Blikre said on Yahoo Finance US's Morning Briefing.

Watch: What is bitcoin halving and how will it impact its price? | Future Focus

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