On February 25, as the price of the leading cryptocurrency hit year-to-date lows, outflows from spot Bitcoin ETFs surged to $1.01 billion—nearly double the previous day’s figure of $516.41 million.
This marked the largest outflow since the approval of BTC-ETFs in January 2024. For comparison, the second-largest outflow was $680 million on December 19.
The cumulative inflow shrank to $38 billion, while the AUM of these products fell to $101.44 billion.
Trading volume for these products reached $7.74 billion.
On February 25, the largest daily outflow was from Fidelity’s FBTC at $344.7 million, followed by BlackRock’s IBIT with $164.4 million and Valkyrie’s BRRR with $100 million.
According to a study by 10x Research, a significant portion of Bitcoin ETF volumes (56%) is linked to arbitrage, where traders profit from the difference between spot and futures prices.
In the current environment, funding rates and basis spreads are too low to justify holding positions and opening new ones, noted Marcus Thielen, founder and head of research at the firm.
Rachel Lucas of BTC Markets told The Block that the outflow was due to profit-taking after Bitcoin’s strong growth in 2024 and weak performance this year. Investors are also concerned about the Fed’s policies and US-China trade relations, she added.
Lucas believes that while ETF outflows could increase volatility, the long-term supply-demand balance remains strong, considering the emission reduction after the halving in April 2024.
Withdrawals may have a short-term impact on price, but this does not necessarily lead to a prolonged downturn, as dynamics are driven by a combination of spot market purchases, network activity, derivatives positioning, and macro factors, the expert indicated.
Previously, Binance CEO Richard Teng described the correction in digital gold prices as a “tactical retreat”.
Bitwise forecasts that net inflows into BTC-ETFs could exceed $50 billion by 2025.
In February, former BitMEX CEO Arthur Hayes suggested Bitcoin could fall to $70,000 due to ETF outflows.