U.S. spot Bitcoin exchange-traded funds (ETFs) continue to manage billions in assets even after bitcoin’s sharp price correction, but analysts caution that this resilience may not be the bullish signal many investors assume. While bitcoin (BTC) surged past $126,000 in early October before plunging to nearly $60,000, total net outflows from the 11 U.S.-listed spot Bitcoin ETFs have reached just $8.5 billion. Despite the steep drop in BTC price, these funds still hold approximately $85 billion in assets under management (AUM), representing more than 6% of bitcoin’s total circulating supply.
At first glance, the relatively modest outflows suggest strong long-term confidence in bitcoin. However, market experts argue that ETF stability is largely driven by market makers and arbitrage-focused hedge funds rather than purely bullish, long-term holders. According to Markus Thielen, founder of 10x Research, the structural composition of Bitcoin ETF ownership plays a critical role in explaining the staying power of these funds.
Recent 13F filings from late 2025 reveal that between 55% and 75% of BlackRock’s iShares Bitcoin Trust (IBIT), which alone manages $61 billion, is held by market makers and arbitrage hedge funds. These participants typically maintain hedged or market-neutral strategies, meaning they are not directly betting on bitcoin price appreciation. Instead, market makers provide liquidity and profit from bid-ask spreads, while arbitrage funds capitalize on price discrepancies between spot Bitcoin ETFs and futures markets.
Because these entities offset their positions to minimize exposure to bitcoin’s volatility, they do not contribute significant bullish or bearish pressure to the broader crypto market. Thielen also noted that market makers reduced their exposure by roughly $1.6 billion to $2.4 billion in the fourth quarter, when BTC traded near $88,000, reflecting lower speculative demand and reduced arbitrage opportunities.
As a result, the resilience of Bitcoin ETFs may reflect structural trading strategies rather than strong directional conviction in bitcoin’s long-term price trajectory.
