Asian Bitcoin investors face volatility due to automated ETF trading bots

Recent volatility in Bitcoin prices in Asia has been closely linked to automated trading algorithms tracking U.S. ETF liquidity.

Investors in Asia are facing turbulent times as automated trading bots react to data flows from spot Bitcoin exchange-traded funds (ETFs).

A report from Bloomberg suggests that these automated trading bots may be causing significant market volatility.

Bitcoin volatility in Asian trading markets

"Shiliang Tang, President of Arbelos Markets, acknowledged the role played by these automated robots, saying: "From an algorithmic trading perspective, robots can automatically crawl and trade based on this data; it seems that is the case now. . ”

Information about the daily demand levels for these spot Bitcoin ETFs reached the cryptocurrency market after the end of U.S. stock market trading during the Asian session. On April 2, during the Asian trading session, Bitcoin experienced a sharp drop that coincided with reports that investors were withdrawing funds from these ETFs. According to reports, during the Asian trading session, Bitcoin prices experienced a plunge, which coincided with reports that investors were withdrawing funds from these ETFs.

According to data from CoinGecko, the price of Bitcoin fell to $64,650 on April 2, losing about 6% in one day. The drop triggered a spike in volatility across the cryptocurrency market. As of this writing, the price of Bitcoin is around $66,300.

The U.S. Securities and Exchange Commission (SEC) approved multiple spot Bitcoin ETF applications in early January, bringing about $12 billion in net inflows to the market. The peak in ETF inflows coincided with Bitcoin’s all-time high of $73,737 in mid-March. However, a subsequent period of outflows caused BTC to drop more than 10% from its peak.

Spot Bitcoin ETF Outflows and Bitcoin Retracement

On Monday, April 1, spot Bitcoin ETF liquidity returned to negative territory again, Grayscale once again experienced large outflows, and Ark 21Shares also saw smaller outflows. According to data from Farside Investors, the total outflow of these 11 spot-based investment products reached $85.7 million, equivalent to 1,200 BTC.

Bloomberg ETF analyst James Seyffart expressed surprise at the development, saying, "It's higher than I expected, to be honest," before further noting, "I think that's going to slow down a little bit now."

Michael, CEO of Galaxy Digital Novogratz predicted the possibility of corrections and consolidation in the market in early March, before Bitcoin surged to new highs.

Despite the overheated market, Novogratz remains optimistic about the future. He anticipates the possibility of the U.S. Securities and Exchange Commission approving a spot Ethereum ETF later this year.

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