The reduction in funds entering Bitcoin spot ETFs has caused significant volatility in Asian markets due to algorithmic trading reactions. Information on demand for these ETFs from the US market influences trading in Asia after US share trading ends.

This week, Bitcoin and other cryptocurrencies faced a major decline during Asian trading hours. This drop was driven by reports of investors withdrawing funds, leading to automated trading systems reacting. Shiliang Tang from Arbelos Markets explained how bots can use this data for buying and selling decisions automatically.

The Bitcoin ETF market has also experienced recent fluctuations. Inflows peaked in early March when Bitcoin reached its all-time high. Since then, there have been outflows, causing Bitcoin's value to drop by 11% from its peak. ETF flows have a more significant impact on Bitcoin compared to gold, as per Charlie Morris of ByteTree Asset Management.

The market returns during Asian trading hours have varied, showing strength in February and early March, followed by declines later in March. Additionally, the liquidation of positive crypto bets worth $354 million on Tuesday affected the market, with algorithms selling Bitcoin leading to further market impacts.

Bitcoin's price dropped by over 6% on Tuesday, hitting $65,400. The market is anticipating the upcoming Bitcoin halving, which could cause a supply shock, potentially raising prices significantly.