Outside Source
Spot Bitcoin exchange-traded funds in the U.S. recorded their highest daily outflows yesterday as Bitcoin dropped below $90,000, triggering a risk-off sentiment among investors amid growing macroeconomic concerns.
According to data from SoSoValue, the 12 spot Bitcoin (BTC) ETFs saw a total of $937.78 million in net outflows on Feb. 25—their highest single-day outflow since launch—significantly surpassing the previous record of $680 million in net outflows on Dec. 19, 2024.
The majority of outflows came from Fidelity’s FBTC, which saw $344.65 million exit the fund, marking its highest daily outflow since launch. BlackRock’s IBIT followed with $164.37 million in net redemptions.
Data for ARK 21Shares’ ARKB was unavailable at the time of reporting, but other ETFs that recorded outflows included:
- Bitwise’s BITB: $88.3 million
- Grayscale’s Mini Bitcoin Trust: $85.76 million
- Franklin Templeton’s EZBC: $74.07 million
- Grayscale’s GBTC: $66.14 million
- Invesco Galaxy’s BTCO: $62.01 million
- Valkyrie’s BRRR: $25.19 million
- WisdomTree’s BTCW: $17.3 million
- VanEck’s HODL: $9.97 million
Despite the sell-off, daily trading volume for spot Bitcoin ETFs surged nearly 167% from the previous day, reaching $7.74 billion. Since their launch, these ETFs have still accumulated a net inflow of $38.08 billion overall.
Market factors driving the sell-off
The ongoing sell-off appears to be driven by Bitcoin dropping below the critical $90,000 level, alongside growing concerns over Donald Trump’s proposed tariffs on Canadian and Mexican goods set to take effect in March.
If a 25% tariff on U.S. imports is enforced, it could lead to higher inflation and slower economic growth, putting pressure on the Federal Reserve to respond. The Fed has maintained that it will only cut interest rates when inflation moves closer to its 2% target, but recent data suggests inflation is moving in the opposite direction.
On-chain data signals increased selling pressure
On-chain data from Santiment shows that more Bitcoin is moving onto exchanges, while whale holdings in non-exchange wallets are declining. This shift suggests that large investors who were previously accumulating BTC are now transferring their holdings to exchanges, which often signals potential selling pressure.
A key metric, BTC supply held by funds, is also dropping, indicating that institutional investors are reducing their Bitcoin holdings. This aligns with the negative net flows in spot Bitcoin ETFs, which have seen outflows on 12 of the last 16 trading days, totaling approximately $2.41 billion since early February.
Analyst insights: Is this just a temporary dip?
Commenting on the downturn in BTC ETFs, Matt Mena, a crypto research strategist at 21Shares, told crypto.news that while some investors fear Bitcoin has peaked, both on-chain and macro indicators suggest the market is still in the early-to-mid bull cycle.
Mena noted that despite this pullback, crypto is still up over 50% from last year, demonstrating its long-term resilience.
With Bitcoin now down 18% from its recent highs, Mena views this correction as a “temporary reset—not the end of the cycle.” He believes it presents a strategic re-entry point for investors who hesitated to enter the market after the election.
“Historically, crypto has punished those who hesitate at key dips. The window for accumulation may not last long,” Mena concluded.
This article first appeared at crypto.news
