Bitcoin Exchange Trade Funds (ETFs) saw a net outflow worth around $370 million on March 7th, as investors responded to plans for a strategic Bitcoin reserve in the US, according to data from Farside investors.
The leak shows institutional investors are wary of Bitcoin (BTC) exposure after Trump's March 6 executive order (creating a national Bitcoin reserve but did not instruct the government to buy Bitcoin.
“While (Trump's executive order) acknowledges Crypto's role in global finance, the lack of fresh purchases has not disappointed the market,” Bitget Wallet's chief operating officer, Alvin Kan, told Cointelegraph.
Source: Ryan Rasmussen
Related: US Bitcoin Reserve UPS Volatility, Futures Reaction
A subtle announcement
On March 6, Trump signed an executive order creating a strategic Bitcoin reserve, separately preparing separate stockpiles of digital assets to hold other cryptocurrencies.
They constitute assets originally acquired by law enforcement and other legal procedures.
The order calls for authorities to “develop budget-neutral strategies to acquire additional Bitcoin,” provided that no incremental costs are imposed on US taxpayers.
“This limited range has not met market expectations and has caused considerable disappointment,” Temujin Louie, CEO of Wanchain, a cross-chain interoperability protocol, told Cointelegraph.
But Trump's “orders open up the possibility of obtaining additional bitcoin unless the acquisition is taxpayer,” Brian Armour, director of passive strategy studies at Morningstar, told Cointelegraph.
“This could potentially introduce new buyers to the Bitcoin ecosystem.”
Market reaction
Bitcoin spot prices fell more than 2% on March 7th, according to Google Finance data.
Meanwhile, data from CME, the largest derivative exchange in the US, shows a decline of more than 2% for the majority of Bitcoin's forward curve.
Futures are standardized contracts that represent contracts that buy and sell assets on a specific future date.
Even if the US government does not actively acquire Bitcoin, “the US strategic Bitcoin reserve … other countries will buy Bitcoin… (and) financial institutions have no excuses,” Bitwise research director Ryan Rasmussen said in the X-Post.
Sold out “easily buy rumors and sell news events,” Austin Arnold, co-founder of Altcoin Daily, told Cointelegraph. “For the long term, this is bullish.”
Magazine: Trump's crypto venture causes conflicts of interest, insider trading questions
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