US Bitcoin ETFs See Record Outflows, BlackRock's IBIT Leads the Exodus

Article Summary

• Record outflows recorded for US spot Bitcoin ETFs.
• BlackRock's IBIT ETF is the largest contributor to the outflows.
• Bitcoin price drops to a seven-month low.
• Warnings of a potentially harsher bear market.

US spot Bitcoin exchange-traded funds (ETFs) witnessed a significant downturn on Thursday, reversing a brief period of positive momentum seen earlier in the week. After snapping a five-day outflow streak with $75.4 million in inflows on Wednesday, these funds faced renewed redemptions totaling $903 million on Thursday. This marks the largest single-day outflow in November and ranks among the most substantial single-day outflows since these products launched in January 2024, according to data from Farside Investors.

The $3.79 billion withdrawal positions November as potentially the worst month on record for US spot Bitcoin ETF outflows, unless the remaining days of the month see a dramatic reversal of this trend. The current figure has already surpassed February’s $3.56 billion, which previously held the record for the largest monthly outflow since the ETFs' inception.

BlackRock's IBIT Accounted for 63% of Total Outflows in November

BlackRock’s iShares Bitcoin Trust (IBIT) ETF is the primary factor driving the historic outflows observed in November. IBIT has seen net redemptions of $2.47 billion so far this month, representing approximately 63% of the total $3.79 billion withdrawn from all US spot Bitcoin ETFs. Furthermore, IBIT spearheaded this week’s outflows with $1.02 billion. Ki Young Ju, founder and CEO of analytics platform CryptoQuant, highlighted this week’s performance as IBIT’s “largest weekly outflow ever.”

Fidelity’s Wise Origin Bitcoin Fund (FBTC) was the second-largest driver of outflows in November, with monthly outflows of $1.09 billion. This week alone, FBTC has experienced $225.9 million in withdrawals, indicating consistent, albeit moderate, redemptions. While FBTC’s outflows are less substantial than IBIT’s, both funds contributed to the broader liquidity drain that pushed November beyond February’s record for the heaviest month of Bitcoin ETF outflows. Collectively, they account for 91% of total US spot BTC ETF outflows in November.

Bitcoin Slips to $83,400 Following Major ETF Outflows

According to CoinGecko, Bitcoin's price declined to $83,461 on Friday in the wake of nearly $1 billion in ETF outflows. This price drop pushed Bitcoin to its lowest level in seven months, a level last seen in April. Industry analysts suggest this downturn might only be the beginning. Alliance DAO co-founder QwQiao reiterated his September warning, suggesting the next bear market could be more severe than anticipated. He stated, “There’s a large cohort of dumb money who know nothing about crypto buying DATs and ETFs. This never ends well,” adding that markets might need to endure another “50% drawdown” before a solid foundation can be established.

Chris Burniske, co-founder of crypto venture firm Placeholder, cautioned that the era of DAT (Digital Asset Treasury) selling has only just begun. He warned that just as ETFs and DATs amplified Bitcoin’s rise, they could similarly exacerbate the decline. Data from DefiLlama indicates that DAT inflows dropped to $1.93 billion in October, an 82% decrease from September’s $10.89 billion. The data shows a significant decrease in inflows after approximately $20 billion in crypto positions were liquidated in October. As of this writing, DAT inflows have reached only $505 million. At this rate, November is projected to be the lowest month for DAT inflows in 2025.