Bitcoin ETFs See Big Outflows as Fear Grips Market

Bitcoin exchange-traded funds in the United States lost $133.3 million on Wednesday alone. Investors pulled money out for the fourth straight day, pushing weekly losses past $238 million and putting these popular funds on track for their first five-week outflow streak ever.

The sudden reversal comes just nine months after spot Bitcoin ETFs launched with huge fanfare. Traders now watch closely to see if the selling pressure will push the cryptocurrency lower or if buyers will step in soon.

Bitcoin started the week near $58,000 but fell hard after weak economic data raised fresh worries about a recession. The Crypto Fear & Greed Index dropped to 26 on Wednesday, its lowest level since January 2023, and stayed locked in “Extreme Fear” territory.

Institutional investors who poured billions into these ETFs earlier this year now take profits or cut risk. Fidelity’s FBTC fund recorded the biggest single-day outflow at $91.3 million. BlackRock’s giant IBIT fund, long the leader in daily inflows, saw $38.1 million leave on Wednesday.

Smaller funds felt the pain too. ARK 21Shares and Bitwise each bled more than $10 million in a single session for the first time in weeks.

Four Straight Days of Losses

Wednesday marked the fourth consecutive day of net outflows:

• Monday: $32.5 million left
• Tuesday: $38.2 million left
• Wednesday: $133.3 million left
• Thursday data (still coming in): early signs point lower again

Total outflows since Friday now top $238 million, the worst weekly stretch since the funds opened in January.

Where the Price Stands Right Now

Bitcoin traded near $56,800 early Thursday, down more than 7% from its weekend high. The drop pushed the price below the closely watched 50-day moving average, a level many traders view as key support.

If that level fails, analysts point to $52,000 as the next major line in the sand. On the flip side, a quick move back above $60,000 could calm nerves and bring buyers back fast.

What Changed Since the Wild Spring Run

Spot Bitcoin ETFs collected more than $17 billion in net inflows during their first three months. BlackRock alone pulled in nearly $20 billion of assets under management at the peak.

Strong inflows helped drive Bitcoin from $45,000 in January to an all-time high above $73,000 in March. But momentum slowed over the summer as interest rates stayed high and new buyers dried up.

Recent government sales of seized Bitcoin from the Silk Road case added extra coins to the market at the same time demand weakened.

Eyes on Next Week and Beyond

Traders now wait for fresh clues. The Federal Reserve meets next week, and any signal of rate cuts could spark risk appetite again. Until then, low weekend trading volume often makes sharp moves more likely.

Many long-term holders still view dips as buying chances. Yet the shift in ETF flows shows that big institutions can change direction fast when fear takes over.

The past nine months proved Bitcoin ETFs can attract huge money on the way up. This week serves as a clear reminder they can send money out the door just as quickly.