Bitcoin stabilises after strong ETF outflows
Bitcoin stabilised to a certain extent, but could remain under pressure after successive sessions of decline and two days of intensive ETF outflows.
Spot Bitcoin ETFs recorded USD 630 million in outflows on Wednesday, one of the largest withdrawals this year. This comes amid large outflows over the last week, weighing on the asset as it reached a multi-month high this month.
The cryptocurrency could continue to face increasingly less supportive macro conditions.
Recent US inflation data surprised to the upside, reinforcing expectations that the Federal Reserve may maintain a cautious monetary policy stance for a longer period of time, while anticipations of potential tightening grow stronger, which could continue to support bond yields and weigh on non-yielding assets.
The market could continue to react to changes in risk appetite, inflation concerns and geopolitical developments. As such, new economic data could tilt monetary policy expectations, while discussions between US President Donald Trump and Chinese President Xi Jinping could influence sentiment to a certain extent. Any deterioration in risk appetite could pressure risk assets, including cryptocurrencies.
