Bitcoin exchange-traded funds (ETFs) are experiencing a significant wave of withdrawals, with over $516 million in net outflows recorded on Monday. This marks the fifth-largest single-day outflow since their inception in early 2024. Leading the withdrawals were Fidelity’s FBTC, which saw $247 million in redemptions, followed by BlackRock’s IBIT ($158.6 million) and Grayscale’s GBTC ($59.5 million). The cumulative five-day outflow streak now exceeds $1.07 billion.
Ethereum ETFs also faced pressure, with $78 million in outflows, bringing their three-day total to $100 million. Analysts believe these withdrawals suggest that the initial wave of crypto ETF investors has completed their allocations, with future inflows dependent on renewed market demand or a broader economic catalyst.
Market Uncertainty and ETF Sell-Offs
The outflows come amid a broader downturn in the crypto market, with Bitcoin plummeting 7.6% in the past 24 hours to trade below $89,000. Ethereum dropped to $2,394, while Solana and XRP suffered steeper losses of 14.4% and 13%, respectively.
Factors contributing to the sell-off include heightened geopolitical tensions, the ongoing Russia-Ukraine war, and concerns about U.S. economic slowdown following weak PMI data. Additionally, recent high-profile crypto-related incidents, such as the LIBRA scam and the Bybit hack, have eroded investor confidence.
Is This a Buying Opportunity?
Despite the negative sentiment, some analysts remain bullish. Bitcoin Opportunity Fund’s David Foley argues that the withdrawals are a natural correction following Bitcoin’s strong run in late 2024. Others, including BRN analyst Valentin Fournier, see this as an opportunity for long-term accumulation, particularly in assets like Solana, which has the potential for outsized gains once the market stabilizes.
While Bitcoin ETFs still hold over $111 billion in assets under management, their ability to attract fresh demand will be critical to determining whether the current downturn is a temporary shakeout or a sign of deeper structural concerns.
Disclaimer: This article is for informational purposes only and does not constitute financial or investment advice.
