Investors pulled more than $8.9 billion from spot Bitcoin exchange-traded funds in recent weeks. The withdrawals mark the largest dollar-value drawdown for the products since they started trading in early 2024.
The outflows began in late February as the price of Bitcoin dropped below $70,000. Data from CryptoQuant shows the average purchase price for ETF buyers was around $79,000. This means a large portion of institutional money in those funds held positions that were worth less than they paid for them.
BlackRock’s iShares Bitcoin Trust, ticker IBIT, was the hardest-hit fund. It lost more than 42,000 BTC from its highest holdings total.
The sell pressure came from several directions. Broader economic concerns, including rising geopolitical tensions, likely added to the decision to pull money out of the funds.
However, the withdrawal numbers have improved since hitting the low point. The net drawdown now sits at roughly $7.8 billion from its all-time high, a recovery of more than $1 billion.
In the five trading days after the worst of the outflows, money moved back into the products. Total inflows reached $1.5 billion during that period. IBIT led the way again, taking in $263 million on March 2 alone. Monthly outflow numbers also slowed down sharply, dropping 94% between November and February.
While ETF money left those products, retail investor deposits to exchanges like Binance fell by about $5 billion. At the same time, companies continue to add Bitcoin to their balance sheets. Strategy Inc. (MSTR) bought 3,015 BTC for $204.1 million recently.
This outflow drained liquidity from one part of the market, but the data suggests that capital was moving to other places. Corporate treasuries and institutional custody accounts absorbed some of what left the ETFs.
