Lead

Spot bitcoin exchange‑traded funds (ETFs) recorded a net outflow of $648.64 million on Monday, the largest single‑day withdrawal since early March, as investors reacted to fresh U.S. inflation numbers and escalating U.S.–Iran tensions, according to data from SoSoValue.

Background

Spot Bitcoin ETFs allow investors to gain exposure to the cryptocurrency without holding the asset directly. Since their launch in early 2024, they have attracted billions of dollars, but they are also sensitive to macro‑economic shifts and market sentiment. Recent weeks have seen Bitcoin’s price fall from a peak of $81,700 to around $76,680, a decline of roughly 6.7%.

What Happened

On Monday, BlackRock’s iShares Bitcoin Trust (IBIT) led the outflows with $448 million withdrawn, followed by ARK Invest and 21Shares ($110 million) and Fidelity ($63 million). The cumulative $648.64 million outflow follows a $1 billion net outflow recorded the previous week.

Bitcoin’s price dropped 0.7% over the past 24 hours, settling near $76,680 after hitting a weekly low of $76,201, according to CoinGecko. The Crypto Fear & Greed Index fell to 25, indicating “Extreme Fear.”

Analysts offered differing explanations. Agne Linge of blockchain infrastructure firm Wefi linked the outflows to a “de‑risking strategy” prompted by the recent escalation in the U.S.–Iran conflict. Illia Otychenko of CEX.IO attributed the withdrawals primarily to last week’s U.S. inflation data, which shifted expectations toward a possible Federal Reserve rate hike this year. Otychenko also noted that concerns about a renewed escalation in the U.S.–Iran standoff, amplified by former President Donald Trump’s remarks, reinforced the de‑risking sentiment.

Despite the outflows, some structural factors may cushion further downside. Vetle Lund of K33 Research highlighted that demand for Strategy’s perpetual preferred stock (STRC) has historically supported mid‑month Bitcoin rallies, though Otychenko cautioned that past instances where STRC demand exceeded etf outflows did not prevent price declines.

Open interest in Bitcoin futures fell from $29 billion to $26 billion over the past two weeks, according to CryptoQuant, but remains elevated by historical standards. Funding rates turned positive after a multi‑month negative stretch, indicating that traders are opening long positions even after $670 million of liquidations were triggered last week.

Long‑term Bitcoin holders have continued to accumulate the asset at a “much bigger scale” than micro‑cap stocks such as MicroStrategy (MSTR), according to Otychenko. Their sustained buying, despite a growing portion of their holdings sitting in unrealized loss, is viewed as a factor that limits Bitcoin’s downside potential.

On the prediction‑market side, users of Myriad, a platform owned by Decrypt’s parent company Dastan, assign a 77% probability that Bitcoin will rise to $84,000, down from 89% a week earlier.