The US spot Bitcoin exchange-traded funds (ETFs) have experienced their largest single-day net outflow, with nearly $938 million exiting the market as Bitcoin struggles to maintain levels below $90,000.
According to CoinGlass data, the 11 Bitcoin ETFs collectively saw a net outflow of $937.9 million on Feb. 25, marking the sixth consecutive day of withdrawals. This exodus comes amid a broader market downturn, with Bitcoin losing 3.4% in the past 24 hours, dropping from an intraday peak of over $92,000 to a low of $86,140.
Fidelity’s Wise Origin Bitcoin Fund (FBTC) led the outflows, shedding a record $344.7 million. BlackRock’s iShares Bitcoin Trust (IBIT) followed, seeing $164.4 million withdrawn. Bitwise’s Bitcoin ETF (BITB) recorded $88.3 million in outflows, while Grayscale’s Bitcoin Trust (GBTC) and Bitcoin Mini Trust ETF (BTC) saw combined losses of $151.9 million—$66.1 million and $85.8 million, respectively.
So far, February has seen around $2.4 billion leave Bitcoin ETFs, with just four days of net inflows recorded this month.
Nate Geraci, president of the ETF Store, voiced his frustration on X (formerly Twitter) on Feb. 26, stating he remains “amazed at how much TradFi hates Bitcoin and crypto,” adding that despite downturns, the asset isn’t going anywhere.
Market analysts, including BitMEX co-founder Arthur Hayes and 10x Research’s Markus Thielen, suggest that many Bitcoin ETF investors are hedge funds capitalizing on arbitrage opportunities rather than long-term BTC holders.
Hayes recently predicted that Bitcoin could drop to $70,000 due to continued ETF outflows. He explained that hedge funds holding IBIT often employ a strategy of going long on ETFs while shorting Bitcoin futures on the CME, aiming for a yield exceeding that of short-term US Treasuries. However, when the “basis” yield declines along with BTC’s price, these funds unwind their positions—exiting IBIT and repurchasing CME futures.
Thielen’s research on Feb. 24 found that more than half of spot Bitcoin ETF investors were engaged in ETF arbitrage. He noted that while this process involves selling ETFs and buying Bitcoin futures, it is largely “market-neutral,” as the two trades effectively cancel each other out, minimizing any direct impact on Bitcoin’s price.
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