Bitcoin’s price followed a broader equity rebound on Friday, yet a fifth consecutive week of exchange-traded fund outflows and lingering uncertainty over landmark U.S. crypto legislation kept gains modest and sentiment fragile.
The world’s largest cryptocurrency rose to around $64,000, tracking a late-week bounce in major stock indexes after a sharp mid-week selloff. However, the upward drift in bitcoin was tempered by renewed pressure from ETF redemptions, which totaled $390 million over the past seven days, according to preliminary data from major issuers.
Market participants noted that the latest outflow streak—now in its fifth week—has extended the longest continuous period of net withdrawals since the launch of U.S. spot bitcoin ETFs in January. Analysts attributed the persistent outflows to a combination of profit-taking after the recent rally, seasonal positioning ahead of the U.S. Labor Day holiday, and ongoing regulatory caution ahead of potential legislation.
The U.S. Senate is considering the Financial Innovation and Technology for the 21st Century Act (FIT21), which would establish a clear framework for digital asset markets. While the bill has bipartisan support, its path to passage remains uncertain, with betting markets assigning just a 10% probability of enactment before the November elections.
"The ETF outflows are a reminder that the market is still in a consolidation phase," said a senior analyst at a major digital asset research firm. "Until we see sustained inflows or clearer regulatory clarity, the path of least resistance remains sideways."
Bitcoin’s correlation with risk assets such as U.S. equities has strengthened in recent weeks, reflecting broader market dynamics rather than idiosyncratic crypto developments. The cryptocurrency’s 30-day correlation coefficient with the S&P 500 recently climbed to 0.78, up from 0.65 in early July, indicating tighter alignment with traditional markets.
Trading volumes across major exchanges remained subdued, averaging around $25 billion daily over the past week, down from peaks above $40 billion in March. Analysts said the lower turnover, combined with the ETF outflows, suggests that speculative interest is still cautious despite the recent price stabilization.
At current levels, bitcoin is roughly 12% below its all-time high of $73,750 reached in mid-March, and down about 4% for the month of August. The cryptocurrency’s market dominance stood at 51.2%, little changed over the past week, reflecting a broadly stable allocation within the digital asset complex.
Investors will be watching closely next week for further ETF flow data and any developments on FIT21, as well as broader macroeconomic indicators such as U.S. jobs data and retail sales figures, which could influence both risk sentiment and crypto positioning.
