Bitcoin investors in Asia face volatility over automated ETF trading bots

Asia-based Bitcoin investors face market volatility as automated trading bots react to data from U.S. Bitcoin ETFs, potentially influencing market swings.

In Asia, Bitcoin investors are navigating through turbulent market swings, allegedly influenced by automated trading bots reacting to data coming from spot Bitcoin exchange-traded funds (ETFs), Bloomberg reports, citing crypto executives.

Arbelos Markets president Shiliang Tang, acknowledged the significance of automated bots, saying from an algorithmic trading perspective, bots “can basically auto-scrape this data and buy and sell based on this.”

“It seems that’s basically what is happening.”

Shiliang Tang

On Apr. 2, Bitcoin price experienced a significant downturn during the Asian trading session, coinciding with indications of investors withdrawing funds from these ETFs. According to data from Coinglass, Bitcoin’s price on Apr. 2 in a moment plunged to $64,650, losing around 6% in a day, and causing the broader crypto market to experience a spike of volatility. As of press time, Bitcoin is trading at $66,346, according to data from CoinGecko.

The approval of multiple spot Bitcoin ETF applications by the U.S. Securities and Exchange Commission (SEC) in early January ushered in approximately $12 billion in net inflows. The peak of ETF inflow aligned with Bitcoin’s new all-time high of $73,798 in mid-March. However, subsequent periods of outflows have contributed to Bitcoin’s current 11% decline from its peak.

Galaxy Digital CEO Michael Novogratz had earlier hinted at the possibility of corrections and market consolidation in early March, prior to Bitcoin’s surge to new highs. Despite the market’s overheated state, Novogratz maintains an optimistic outlook for the future, anticipating potential approval for spot Ethereum ETFs by the U.S. Securities and Exchange Commission later in the year.