Fed Hike Shock: BlackRock Leads $746 Million Bitcoin ETF Exodus

“We must be confident that underlying inflation is moving to our objective clearly and at sufficient speed,” Federal Reserve chair Kevin Warsh said at his press conference on Wednesday, after the central bank raised its benchmark rate by a quarter point to a range of 3.75% to 4%, its first increase since July 2023. “Today, the FOMC decided that this standard has not been satisfied.” Bitcoin slipped below $76,000 on the decision and traded at $76,611 on Thursday afternoon, up 1.2% over 24 hours, according to CoinGecko.

The vote was 12-0 and the statement ran to 114 words. “Inflation remains elevated,” it said. “Today’s policy action will support a timelier return to the Committee’s 2 percent goal. The Committee will deliver price stability.” Markets had priced the hike at better than 90%, CNBC reported.

The money that left crypto did so through the funds Wall Street built to bring it in. Spot bitcoin ETFs lost a net $450.4 million on Tuesday, their largest single-day outflow since June 24, and another $295.9 million on Wednesday, according to Farside Investors data cited by Coinpaper, $746.3 million in two sessions.

BlackRock’s iShares Bitcoin Trust gave up $161.7 million on Tuesday and $144.1 million on Wednesday, the largest exit of any fund over the two days, while Fidelity’s FBTC lost $214.8 million on Tuesday alone. Morgan Stanley’s MSBT was the only bitcoin fund to take in money on Wednesday, $3.5 million of it. Ether ETFs lost $224.1 million on Wednesday with no fund reporting an inflow, per SoSoValue figures reported by Bitcoin.com News.