Over the past six weeks, U.S. spot Bitcoin exchange-traded funds have seen net outflows of approximately $6 billion, marking the longest consecutive weekly streak of withdrawals since the products launched in 2024.
The largest fund, BlackRock's iShares Bitcoin Trust (IBIT.US), was the hardest hit, losing $1.3 billion in the most recent week alone. This accounted for over 70% of the total industry outflows for that period.
On-chain data indicates that long-term holders, those who have held Bitcoin for more than 155 days, have remained steadfast and still control about 83% of the circulating supply. The selling pressure has almost entirely come from allocative capital that purchased ETFs through brokerage accounts.
The nature of the selling appears to be more about de-risking and portfolio rebalancing rather than a wholesale rejection of the asset. Several factors are driving speculative capital away, including rising inflation with core PCE climbing back to 4.1%, a more hawkish Federal Reserve stance increasing the probability of rate hikes, the massive $700 billion annual investment flowing into AI infrastructure, and hot IPOs like SpaceX diverting funds.
Consequently, when trading desks execute broad sell-offs, Bitcoin is being treated as a high-beta risk asset—first to be cut and often the most deeply affected. Realized losses have surged by 78% month-over-month, with most sellers having cost bases concentrated between $55,000 and $68,000, leading to stop-losses near the lower end of that range.
The pace of outflows shows signs of deceleration, shrinking from $1.72 billion in the first week of June to $226.8 million by mid-month, a slowdown of nearly 90%.
However, the structural issue where the largest ETF has become the primary source of selling pressure remains unresolved. IBIT is so large that its outflows alone create significant pressure. On the day the entire market saw outflows of $444.5 million, all of that money came from IBIT.
With spot trading volume shrinking, on-chain activity cooling, ETF buying appetite waning, and new capital inflows drying up, buyers have largely disappeared from the market.
If outflows from IBIT slow further and Bitcoin can reclaim the $60,000 level, this retreat could be viewed as a healthy reset of market positioning. However, if IBIT experiences another wave of heavy redemptions and the price fails to hold above $58,000, it would signal that non-ETF spot buyers must bear the full brunt of the selling pressure from institutional exits alone.
Comments