Bitcoin and Ethereum ETFs Bleed $439M as Options Traders Brace for More Downside

Group 1 - Bitcoin and Ethereum exchange-traded funds (ETFs) experienced significant outflows totaling $439 million, primarily due to investor repositioning around the Federal Reserve's rate cut and anticipation of upcoming inflation data [1][2] - Bitcoin ETFs faced the largest outflows of $363.1 million, with Fidelity's FBTC and ARK 21Shares' ARKB being the most affected, losing $276.7 million and $52.3 million respectively [1][2] - Ethereum funds recorded $76 million in redemptions, led by Fidelity's FETH with $33.1 million, Bitwise's ETHW at $22.3 million, and BlackRock's ETHA at $15.1 million [2] Group 2 - The recent outflows are interpreted as a phase of profit-taking and de-leveraging rather than indicating a structural bear market, as noted by analysts [3][5] - If ETF flows turn positive in the near term, Bitcoin could rebound above $113,000 and Ethereum could approach $4,200; however, persistent outflows may lead Bitcoin to retest $108,000 and Ethereum to drop to $3,900 [4] - Over $354 million in crypto positions were liquidated recently, including $44 million in Bitcoin and $53 million in Ethereum, indicating a significant market adjustment [4] Group 3 - The macro environment for digital assets remains bullish despite short-term bearishness, supported by the Fed rate cut and stock indices at all-time highs [5] - Options traders are optimistic about the fourth quarter, despite the current market turbulence, as indicated by the put-call delta skew reaching its highest since early August [6]