U.S. exchange-traded funds (ETFs) recorded inflows of $240 million on Thursday, marking the first day of positive flows since Oct. 28, according to Farside data.
No outflows were reported from any ETF providers, ending a six-day streak of consecutive outflows. The longest stretch of outflows since the ETFs launched remains eight consecutive trading days, a pattern that has historically coincided with market or local bottoms for bitcoin.
Since the US government shutdown began on October 1st, ETF flows have been mostly negative, except for the first week of October when bitcoin briefly rose from $114,000 to $126,000. Sustained outflows have since aligned with bitcoin’s fall to $100,000. The asset is now down 11% since the close, while the Nasdaq and gold are up 2% and 4% respectively.
As the shutdown continues, it is expected to further erode market confidence and increase the risk of reduced liquidity, which is likely to curb investor appetite for risk assets such as bitcoin. Notably, the 2018-2019 government shutdown coincided with a market bottom for bitcoin in that cycle.
According to prediction platform Polymarket, there is currently about a 50% chance that the government shutdown will extend beyond November 16, a scenario that could continue to weigh on bitcoin and the broader crypto market.
Bitcoin’s current correction, which began on October 6, has seen a 21% drop over 31 days. In comparison, the correction during the rate-driven sell-off in April lasted 79 days and resulted in a 32% decline.
