Bitcoin ETFs Lost $143M as Trump's Crypto Reserve Proposal Fueled Investor Fears.

The U.S. spot Bitcoin ETF market is in turmoil as net outflows nearly double, fueled by growing fears over President Donald Trump's controversial crypto reserve proposal.

The U.S. spot bitcoin ETF market is now showing signs of turmoil as net outflows nearly doubled on March 4, fueled by growing fears over President Donald Trump’s controversial crypto reserve proposal.

According to data from digital asset management firm Farside, Bitcoin ETFs saw a total outflow of $143.43 million, almost double the previous day’s net outflow of $74.19 million.

Among the biggest losers were Fidelity’s FBTC and ARK 21Shares’ ARKB, which saw outflows of $46.08 million and $43.92 million, respectively. Franklin Templeton’s EZBC also faced heavy selling, as investors pulled out $35.71 million.

Other Bitcoin ETFs, including those from Bitwise, Invesco Galaxy, and WisdomTree, also saw funds being pulled out. However, Grayscale’s mini Bitcoin Trust recorded a net inflow of $35.77 million, slightly offsetting the losses.

The total bitcoin ETF outflow comes as bitcoin price has been showing signs of recovery, surging 5.4% to trade around $87,620. However, this sudden drop triggered a wave of liquidations, with traders losing a total of $479 million in just 24 hours.

According to data from crypto analytics firm Glassnode, around 159,125 traders were affected, with the biggest single liquidation happening on Binance’s XRP/USDT pair, which saw $6.82 million being liquidated.

The liquidations come as Trump's proposal to create a U.S. crypto reserve drew mixed reactions, with some expressing concerns over potential inflation and stability risks.

The proposal, which came after Trump announced his candidacy for the 2024 presidential election, suggested tying the new crypto to the dollar and using it for government transactions.

The news also had a mixed impact on Ethereum ETFs, which broke an eight-day outflow streak and recorded a net inflow of $14.58 million.

Fidelity’s FETH led the way with $21.67 million in fresh capital, while Grayscale’s ETHE and mini Bitcoin Trust funds attracted $10.71 million and $8.46 million, respectively.

On the other hand, BlackRock’s IBIT saw an outflow of $26.27 million, but it wasn’t enough to change the overall trend.

The March 4 data also showed that the total cryptocurrency market cap increased by 1.34% to $1.21 trillion, with bitcoin's market cap rising 2.43% to $1.71 trillion.

The price of bitcoin is expected to find support at the Fib level of $7899, while a move above the resistance at $9477 could push it towards the Fib level of $11055.

On the other hand, if bitcoin fails to hold onto the support at $7899, it could continue to decline and reach the Fib level of $6316.