Bitcoin holds above $60,000 as ETF outflows, Fed outlook weigh on sentiment
Investing.com -- Bitcoin traded back above the $60,000 mark on Sunday after briefly falling below the key level earlier in the weekend, as persistent ETF outflows, a stronger U.S. dollar, and expectations for tighter monetary policy continued to weigh on market sentiment.
Bitcoin was trading down 0.25% at $60,273.4 as of 04:37 ET (08:37 GMT) after briefly falling below $60,000 earlier in the weekend. The cryptocurrency is on track for a rare second straight quarterly loss, marking only the third time it has started a year with back-to-back quarterly declines.
Institutional demand has weakened in recent sessions. U.S. spot Bitcoin ETFs recorded a seventh straight day of net outflows, with about $445 million leaving Bitcoin funds on Friday. Total monthly outflows have reached roughly $4.06 billion, reducing total ETF assets to about $72.8 billion.
Despite the selling, on-chain data suggests large investors have been buying into the weakness. Transactions worth more than $100,000 and $1 million surged after Bitcoin briefly traded below $60,000, indicating whales were accumulating during the selloff.
At the same time, long-term holders have started realizing losses after weeks of price declines. Analysts said that could eventually reduce selling pressure as profitable supply becomes increasingly limited.
Macro conditions have also remained challenging. Markets have shifted toward expecting additional Federal Reserve rate hikes under Chair Kevin Warsh, supporting the U.S. dollar and pressuring risk assets, including cryptocurrencies.
The stronger dollar has also weighed on gold and silver, with all three assets retreating as investors unwind the so-called "debasement trade," which had benefited scarce assets viewed as hedges against currency weakness.
Grayscale Research said Bitcoin's next major move could depend on several upcoming catalysts, including future Fed decisions, progress on the CLARITY Act in the U.S. Senate, and developments surrounding Strategy's balance sheet after concerns over its leveraged Bitcoin acquisition model.
Despite the recent correction, Grayscale said long-term fundamentals remain intact, pointing to continued institutional adoption, expanding stablecoin use, and growing tokenization of real-world assets as structural drivers for the digital asset industry.
Investors will also be watching whether ETF flows stabilize in the coming weeks, as renewed institutional demand could help determine whether Bitcoin can build on its rebound above $60,000.
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