Bitcoin algos tracking ETF flows cited for token’s swings in Asia
Bitcoin investors facing pronounced swings in Asia may be grappling with the fallout of automated trading protocols reacting to flows data for US exchange-traded funds holding the cryptocurrency.
Daily figures on the level of demand for these spot-Bitcoin ETFs propagate across the crypto market in Asian hours following the close of US share trading. On Tuesday, the digital asset embarked on its worst drop in a month in the Asian morning as the flows numbers pointed to investors pulling money out.
“From an algorithmic trading perspective, bots can basically auto-scrape this data and buy and sell based on this,” said Shiliang Tang, president of principal trading firm Arbelos Markets. “It seems that’s basically what is happening.”
A batch of US Bitcoin ETFs went live on Jan. 11 and has pulled in a net $12 billion so far. The pace of inflows crested in the first half of March, when Bitcoin surged to a record high of $73,798. The sector has suffered bouts of outflows since then and the token is down about 11% from the all-time peak.
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