Cracks Beneath the Greed: Why Crypto’s Risk-On Rally Is Splintering

Bitcoin is now trading over $83,000, and the Fear and Greed Index has risen to 68, firmly in the "Greed" territory for the past month.

Risk appetite seems to be returning.

The surge, driven by ETF inflows and economic hopes, is extremely fragile internally, although the index doesn't fully reflect this.

Ethereum ETF outflows differ significantly from Bitcoin outflows.

The 'Selective Return' of ETF Flows

US spot Bitcoin exchange-traded funds saw a dramatic change in fortunes around the middle of September.

There was a significant change from cumulative net outflows of $5.8 billion year-to-date in July to net inflows of around $934 million by late September, with over $3 billion coming in eight days.

An astounding $1.2 billion poured into BlackRock's IBIT in the span of a week, while $702 million poured into Fidelity's FBTC.

As a result of that rise, Bitcoin's price jumped from below $80,000 to approximately $87,000 again.

As October began, the pattern turned around again.

The largest one-day net outflow since June 25th occurred on October 8, reaching $484.9 million. A further $244 million was removed the day after that.

The most prominent assets that were withdrawn were FBTC (Fidelity) and IBIT (BlackRock).