Bit Bitcoin ETF (exchange-traded fund) recorded significant net outflows this week. Institutional investors withdrew about $800 million from the market amid market uncertainty.
Despite high expectations for the White House Cryptocurrency Summit, Bit Bitcoin ETF has seen outflows for 4 consecutive weeks. This suggests that institutional sentiment remains cautious. Over the past 4 weeks, more than $4.5 billion in net assets have flowed out of the market.
Massive outflows from Bit Bitcoin, Ethereum ETFs
According to data from Sosovalue, the US Bit Bitcoin ETF experienced a total net outflow of $799.39 million this week after 5 consecutive days of negative flows.
The largest single-day outflow this week occurred on Friday, with $409 million withdrawn from the Bit Bitcoin ETF.
Data from Farside Investors corroborates this outlook. The major outflows on Friday were primarily driven by the ARKB from Arc Invest and the FBTC ETF from Fidelity, which recorded negative flows of $160 million and $154.9 million, respectively.
BlackRock's IBIT and Grayscale's GBTC recorded $39.9 million and $36.5 million, respectively. Meanwhile, other issuers except for Bitwise (BITB) saw no outflows.
Ethereum ETF also continued the negative trend, recording net outflows for the second consecutive week.
These negative flows occurred despite the high interest in the White House Cryptocurrency Summit. The outflows suggest that macroeconomic concerns and strategic market positioning overshadowed the event's influence.
Some analysts point to persistent fears over President Trump's trade tariffs and widespread economic instability, which they say have eroded institutional confidence. Industry experts, in particular, emphasize that structural changes in the market may be a possible explanation for the sustained capital outflows.
Kyle Samani recently explained that hedge funds have been utilizing low-risk arbitrage trades between Bit Bitcoin spot ETFs and CME futures. However, the collapse of these trades has led to liquidity being withdrawn from the market, impacting the selling and outflows of crypto investment products.
QCP Capital explains crypto market reaction
Meanwhile, a recent report from QCP Capital provided additional insights into the market reaction. The firm noted that the White House Cryptocurrency Summit was initially expected to be a major bullish catalyst, but President Donald Trump's signing of an executive order to establish a strategic Bit Bitcoin reserve and a US digital asset reserve pre-empted expectations.
After the signing, Bit Bitcoin price plummeted from $90,000 to $85,000. Analysts called this a "sell the news" event, as market participants who had expected a bullish outcome from the summit were caught off guard and triggered a sharp sell-off.
"This reaction is likely due to the perception that no actual budget has been allocated for Bit Bitcoin purchases in the short term." – Excerpt from the QCP report
This explains the peak of Bit Bitcoin ETF outflows on Friday. Overall, macroeconomic factors are clearly instilling fear among institutional investors, at least in the short term.
