Bitcoin fell to $38,501 as ETF outflows tested the launch rally

Bitcoin traded as low as $38,501 on Coinbase during the UTC session on January 23, 2024, extending a sharp reversal from the excitement surrounding the launch of U.S. spot-bitcoin exchange-traded products.

The move mattered because it was the market’s first substantial test of a new institutional structure. The Securities and Exchange Commission had approved exchange rule changes covering 11 bitcoin-based commodity trusts and trust units on January 10, and the products began trading on January 11. Less than two weeks later, bitcoin had surrendered more than one-fifth of its Coinbase intraday peak.

The market record

Coinbase Exchange’s BTC-USD daily candle for the 24 hours beginning at 00:00 UTC on January 23 recorded an opening price of $39,524.27, a high of $40,144.49, a low of $38,501 and a close of $39,878.30. That placed the close about 0.9% above the session open, despite the deep intraday decline.

That distinction is important: January 23 produced a new local low, but it was not a uniformly falling UTC session. Bitcoin recovered roughly $1,377 from the low to the Coinbase close. Prices and daily boundaries can differ across exchanges, benchmarks and time zones, so the Coinbase figures describe one named dollar market rather than a universal bitcoin price.

The same Coinbase dataset recorded a $49,102.29 intraday high on January 11. Comparing that venue-specific high with the January 23 low gives a calculated drawdown of 21.6%. The calculation is simply the difference between the two prices divided by the January 11 high; it is not an investor-return measure and does not account for execution, fees or continuous trading on other venues.

Contemporaneous Reuters reporting offered a useful cross-check. At the service’s observation point on January 23, bitcoin was quoted at $38,900, down 20.6% from approximately $49,000 on January 11. The small difference from the Coinbase calculation reflects different observation times and rounded reference prices.

Fund flows complicated the launch story

A maintained fund-flow table from Farside Investors estimates that the U.S. spot-bitcoin products recorded a combined net outflow of $106.1 million on January 23. Its fund-level figures show $515.3 million leaving Grayscale Bitcoin Trust, or GBTC, against a combined $409.2 million entering the other products reporting positive flows.

Those figures describe estimated creations and redemptions in millions of U.S. dollars, not exchange trading volume. They may also be revised as issuer information is reconciled. The table nevertheless captures the central tension visible on January 23: demand for newly launched products from BlackRock, Fidelity, Bitwise, ARK and others was substantial, but it did not offset the day’s estimated GBTC outflow.

The broader launch had not become a net rejection. Adding Farside’s daily totals from January 11 through January 23 produces an estimated cumulative net inflow of $982.9 million. The negative daily reading therefore showed that legacy-fund exits could overwhelm new-product demand over a particular session even while the launch-period total remained positive.

What could and could not be concluded

The timing made fund flows a plausible source of selling pressure, but the records available on January 23 did not prove that ETF redemptions alone caused bitcoin’s decline. Profit-taking after a widely anticipated regulatory decision, liquidations, activity on offshore venues and broader risk positioning could also affect the continuously traded market.

The defensible event-day conclusion was narrower: bitcoin’s post-approval rally had reversed into a drawdown exceeding 20% on Coinbase, and the new U.S. fund complex was transmitting both fresh demand and sizable exits. January 23 demonstrated that regulated access could change the route through which capital reached bitcoin without eliminating the asset’s volatility.