BlackRock IBIT short interest plunges…"Returns to April levels"

JH Kim

Summary

A Bloomberg ETF analyst reported that the short interest of BlackRock's Bitcoin spot ETF IBIT has recently fallen sharply, approaching April levels.
Market observers analyzed that the reduction in short-selling proportion is closely linked to changes in investor sentiment.
IBIT is one of the Bitcoin ETFs with the largest inflows this year and is used as a representative indicator of institutional capital flows.

The short interest of BlackRock's Bitcoin (BTC) spot exchange-traded fund (ETF) IBIT has recently decreased sharply. Market analysts say that, amid a continued short-term downtrend, the reduction in short-selling share is viewed as a trend related to changes in investor sentiment.

On the 24th (local time), Bloomberg ETF analyst Eric Balchunas said on X (formerly Twitter), "IBIT short positions have plummeted and have nearly returned to pre-rally April levels." He added, "Short interest was not high to begin with, at around 2% of issued shares, but the recent rapid decline is noteworthy."

Balchunas explained, "Investors tend to short in rallies and buy in downturns," saying that the reduction in IBIT short-selling suggests investors are reversing positions in the current market correction phase.

IBIT is one of the Bitcoin ETFs that has received the most inflows this year and is used as a representative indicator of institutional capital flows. Recently, as Bitcoin's price adjusted below $100,000, changes in ETF supply and demand have also emerged as a focus for financial markets.