U.S. spot Bitcoin ETFs have seen record‑breaking outflows in recent months, driven by shifting institutional strategies and macroeconomic pressures.
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Feb 25, 2025: ETFs saw a single‑day outflow of $937.8M, the largest since their launch in January 2024, led by Fidelity (FBTC) and BlackRock (IBIT) .
Feb 26, 2025: Cumulative outflows hit $3.2B over eight days, matching the previous longest outflow streak.
Feb 26, 2025: Another sharp outflow of $1.01B, marking the largest single-day net in six trading streams.
February 2025 (monthly total): Spot Bitcoin ETFs purged a total of $3.5B, a dramatic reversal from January’s $4.8B inflows.
Why Such Large Outflows?
1. Institutional Rebalancing & Shrinking Futures Premium
As futures premiums (basis used in cash‑and‑carry trades) dwindled below yields on 10‑year Treasuries (~4–5%), many institutions unwound trades—selling ETF shares and buying back futures—triggering withdrawals.
Reports show several hedge funds and money managers trimming or exiting positions in IBIT and others.
2. Macro & Risk‑Off Sentiment
The broader crypto market faced pressure from inflation concerns, geopolitical tensions (e.g., U.S. tariffs), and events like the Bybit hack—pushing investors toward safer assets.
February marked Bitcoin’s worst monthly drop since mid‑2022 (~–17%) coinciding with ETF outflows.
3. Retail and Tactical Institutional Moves
Though institutional momentum cooled, retail investors remained steady, with only a small part of ETF assets moving (outflows <2% of total).
Some firms, like ARK and Bitwise, still attracted inflows amid broader flows.
Recent Turnaround?
March 18, 2025: ETFs recorded the largest inflow since early February—$274.6M in a single day, ending a five‑week outflow streak totaling $5.4B.
This suggests some renewed interest, though total ETF assets still sit around $94B—well below February's peak.
These movements often amplify Bitcoin’s price volatility—ETF outflows coincided with BTC dropping below ~$87k–90k