"Digital gold" loses its shine! Bitcoin falls to a two-month low, with nearly $5 billion in net outflows from US ETF funds in March.

During the early trading session in Asia on Friday, Bitcoin dropped to its lowest point in two months. The market sentiment for the world's largest cryptocurrency remains low, with investors withdrawing capital from its exchange-traded funds (ETFs). On Friday, the price of Bitcoin plummeted by 3.9% to reach $81,102, hitting a new low since November 21, continuing the overnight accelerated downtrend. Its price has dropped more than 34% compared to its all-time high on October 6 last year. According to CoinGlass data, within the past 24 hours, the total amount of long positions in the entire cryptocurrency market that were forced to close out exceeded $1.5 billion. Twelve Bitcoin spot ETFs listed in the United States have seen net outflows for three consecutive months. If this trend continues until the end of January, it will mark the longest period of continuous outflows since the launch of these products in 2024. Compiled data shows that during this period, the outflow of funds from these funds totals approximately $4.8 billion. The decline in Bitcoin stands in sharp contrast to the recent surges in precious metals like gold. Faced with political uncertainty from GEO Group Inc, safe-haven funds are moving away from cryptocurrencies and into traditional safe-haven assets, leading to skepticism about Bitcoin being called "digital gold". FxPro's Chief Market Analyst, Alex Kuptsikevich, stated: "Cryptocurrency is no longer seen as an alternative to fiat currencies, nor can it hedge against the risks of fiscal policies that are not robust enough in major economies." The flow of funds in funds directly confirms this market shift. The largest Bitcoin ETF in the worldiShares (IBIT.US) under BlackRock, Inc., which is one of the most successful fund launches ever, has a lesser asset management scale compared to BlackRock, Inc.'s gold ETF. One important indicator for determining whether Bitcoin truly possesses the attributes of "digital gold" is its value performance relative to gold. From this perspective, Bitcoin's performance is concerning: since the peak at the end of 2024, its value relative to gold has plummeted by around 60%. For some traders, this recent drop in Bitcoin is just the beginning. If the bearish sentiment continues into the weekend, the price is likely to fall below the $80,000 mark. Researcher at Kaiko, Adam McCarthy, said: "If Bitcoin falls to the $70,000 range in the short term, I wouldn't be surprised at all." He stated that if Bitcoin prices fall below $80,000 today, the downward trend may continue into the weekend, with low market liquidity amplifying the extent of the price drop. IG Australia's Market Analyst, Tony Sycamore, believes that the current selling spree of Bitcoin aligns with his previous assessment: the rebound in Bitcoin since its low point in November last year is essentially a corrective counter-trend rally. He bluntly stated: "The overnight drop indicates that Bitcoin's downward trend has officially resumed."