Bitcoin Cools Off After $3 Billion ETF-Driven Surge

Bitcoin slid Friday afternoon, cooling down after a phenomenal run following huge investment from U.S. ETF buyers. 

The leading cryptocurrency was trading for $77,379 on Friday afternoon in New York after dropping more than 3% over a 24-hour period. 

Bitcoin hit a high this week of $81,281 but slowed down after Federal Reserve Chair Kevin Warsh gave his first major speech as head of the central bank — saying on Friday that he had “more work to do” to fight inflation. 

The Bitcoin price has in the past dropped when the Federal Reserve thinks inflation is too high because it means less chance of a rate cut; the leading cryptocurrency typically does better in a low-interest rate environment. 

Bitcoin started surging last week after the U.S. Treasury would at least double the size of its liquidity-support buyback operations. The announcement last week hurt the dollar but non-yielding assets have benefited. 

Exchange-traded funds, managed by the likes of BlackRock, Fidelity, and Grayscale have received net positive inflows for nine days in a row, according to Farside Investors data. Last week was their best week since October — when bitcoin hit a new all-time high — and that run has continued into this week.