The bullish momentum seen earlier this week in U.S. spot Bitcoin exchange-traded funds abruptly reversed on Wednesday, with investors pulling out nearly half a billion dollars as the world’s largest cryptocurrency slid to around $108,000 before staging a mild recovery.
Fresh data from Farside Investors showed that major issuers faced heavy withdrawals after several days of inflows. Fidelity’s fund accounted for the largest portion of the losses, while ARK Invest and BlackRock followed closely behind. Grayscale’s flagship trust and Bitwise’s ETF also recorded smaller redemptions, rounding out a difficult trading session for institutional crypto products.
The timing of the sell-off raised eyebrows across the financial community. It came right after the Federal Reserve delivered a quarter-point rate cut that initially lifted risk appetite but quickly reignited concerns about lingering inflation and a possible slowdown in growth. The mixed signals left investors unsure whether to treat the move as a green light for renewed risk-taking or a sign of trouble ahead.
Bitcoin Price Caught in Crosscurrents
Bitcoin reflected that hesitation in price action, swinging sharply between $108,000 and $113,000 throughout the day. The drop came despite positive geopolitical news, as U.S. President Donald Trump and Chinese President Xi Jinping struck a deal to ease trade tensions and maintain rare earth exports. The combination of shifting monetary policy and global diplomacy has created a volatile backdrop that continues to test investor conviction.
Market analysts say this pattern of ETF inflows and outflows closely mirrors short-term shifts in sentiment rather than long-term demand. “Institutional investors appear to be taking quick profits and rebalancing as macro risks remain unpredictable,” said one strategist.
ETF Holdings Still Tower Over the Market
Even after the pullback, spot Bitcoin ETFs collectively hold more than 1.5 million BTC—an amount worth roughly $169 billion at current prices and representing over 7% of the total circulating supply. BlackRock’s vehicle leads the pack, followed by Fidelity and Grayscale, each controlling hundreds of thousands of coins.
Cumulative inflows remain positive at around $61 billion, underscoring how deeply traditional finance has embedded itself in the Bitcoin ecosystem despite occasional bouts of volatility. The total assets under management now sit near $149 billion, reflecting both price weakness and modest redemptions.
Long-Term Bulls Stay Unshaken
While ETF activity suggests short-term caution, long-term believers are holding firm. MicroStrategy chairman Michael Saylor reiterated this week that he sees Bitcoin reaching $150,000 by the end of next year, arguing that institutional integration and tightening supply dynamics will eventually outweigh macro jitters.
For now, traders are bracing for more turbulence as markets digest the Fed’s policy shift and assess whether Bitcoin’s next decisive move will come from renewed institutional accumulation—or another wave of redemptions.
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Source: https://coindoo.com/bitcoin-etfs-bleed-470-million-as-market-struggles-to-find-direction/