Key facts
- Bitcoin's price fell below $65,000 on July 23.
- U.S. spot Bitcoin ETFs recorded $225.2 million in net outflows, breaking a seven-day inflow streak.
- BlackRock's IBIT saw outflows of $202.5 million, while Morgan Stanley's MSBT added $5 million.
- Spot Ethereum ETFs experienced inflows of $26.3 million, extending their streak to five days.
- Rising geopolitical tensions between the U.S. and Iran, including threats of attack and rejection of a ceasefire proposal, are cited as market influences.
Bitcoin experienced a notable price drop below $65,000 on July 23, coinciding with heightened geopolitical tensions between the U.S. and Iran. President Trump threatened a "massive attack" on Iran, which in turn rejected a U.S. ceasefire proposal and prepared for escalation. This uncertainty impacted financial markets, with U.S. stocks also declining and oil prices remaining elevated.
U.S. spot Bitcoin ETFs saw significant net outflows totaling $225.2 million, marking the end of a seven-day streak of inflows that had accumulated nearly $1 billion. BlackRock's iShares Bitcoin Trust (IBIT) was the largest contributor to these outflows, shedding $202.5 million. In contrast, Morgan Stanley's Bitcoin ETF (MSBT) was the sole fund to record inflows, adding $5 million.
Meanwhile, spot Ethereum ETFs continued their positive trend, adding $26.3 million and extending their own inflow streak to five consecutive days. This divergence suggests a potential rotation within the crypto market rather than a complete exit. The Crypto Fear & Greed Index dropped to 28, indicating "fear" in the market.
Analysts noted that the recent outflows followed a period of significant withdrawals from Bitcoin ETFs, with over $8.2 billion drained in the preceding eight weeks. The upcoming Federal Reserve meeting on July 28-29 is seen as a key event that could influence the near-term macroeconomic picture and, consequently, Bitcoin's trajectory.