Bitcoin ETFs Bleed $1.62B in Four Days — Are Hedge Funds Dumping BTC?
Bitcoin spot exchange-traded funds have skilled steep outflows over 4 buying and selling days, dropping a mixed complete of $1.62 billion.
The exit has raised a query on whether or not hedge funds are withdrawing their Bitcoin publicity because the market situations change.
The withdrawals happen as Bitcoin fails to regain momentum round crucial worth factors, whereas a once-popular institutional arbitrage technique steadily loses its enchantment.
BlackRock’s IBIT Leads Bitcoin ETF Outflows as BTC Slips Below $90K
As of January 22, 2026, US-listed spot Bitcoin ETFs recorded internet each day outflows of $32.11 million, extending a streak of redemptions that peaked at $708.71 million on January 21, following $483.38 million on January 20, Sosovalue data reveals.
In the final one week, internet outflows amounted to 1.22 billion.
Trading exercise stayed sturdy on January 22, with Bitcoin spot ETFs recording $3.30 billion in quantity, at the same time as belongings underneath administration dipped to $115.99 billion, about 6.49% of Bitcoin’s market cap.
BlackRock’s iShares Bitcoin Trust led each day outflows, with $22.35 million redeemed, equal to roughly 249.5 BTC.
Despite the withdrawal, IBIT stays the dominant product, holding $69.84 billion in belongings and practically 4% of the Bitcoin provide represented in ETFs.
Fidelity’s FBTC adopted with $9.76 million in outflows, whereas Grayscale’s GBTC reported flat each day flows however stays deeply damaging general, with $25.58 billion in cumulative internet outflows as traders proceed rotating away from its increased 1.5% charge.
Other issuers, together with Bitwise, Ark and 21Shares, VanEck, Invesco, Valkyrie, Franklin, and WisdomTree, recorded largely unchanged flows, exhibiting a pause reasonably than broad panic promoting.
The ETF pullback has unfolded alongside weak point in Bitcoin’s worth.
BTC was trading round $89,982 on January 22, down 1.3% on the day and practically 5% over the previous week, after briefly dipping to $88,600.
Trading quantity has additionally cooled, falling practically 28% to $37.77 billion, an indication that market participation is thinning as costs consolidate beneath $90,000.
Compressed Yields Trigger Hedge Fund Exit From Bitcoin ETFs
Market observers level to hedge fund positioning as a key driver behind the ETF outflows.
Amberdata shows that yields on the Bitcoin foundation commerce, a technique that buys spot Bitcoin through ETFs whereas promoting futures to seize worth spreads, have dropped beneath 5%, down from round 17% a 12 months in the past.
As returns compress and method the yield obtainable on short-dated US Treasuries, fast-moving capital has much less incentive to remain deployed.
Analyst famous that whereas hedge funds doubtless symbolize solely 10% to twenty% of ETF holders, their exercise can overwhelm flows in the brief time period when the commerce stops working.
Bloomberg information shows that the unwind is seen in derivatives markets as effectively.
Bitcoin futures open curiosity on Chicago Mercantile Exchange (CME) has fallen beneath Binance’s for the primary time since 2023, exhibiting lowered participation in cash-and-carry trades by US establishments after ETFs launched there.
One-month annualized foundation yields now hover close to 4.7%, barely clearing funding and execution prices, as spreads tighten and arbitrage alternatives fade.
CryptoQuant indicators show obvious demand turning damaging, whale and dolphin wallets shifting from accumulation to distribution.
Also, the Coinbase premium remained deeply damaging, suggesting weaker urge for food from US establishments.
At the identical time, leverage in Bitcoin futures has climbed to its highest degree since November, growing the market’s sensitivity to sharp strikes in both course.
Flows in different crypto ETFs underline that the sell-off isn’t uniform.
Ethereum spot ETFs additionally recorded heavy outflows this week, together with $41.98 million on January 22, whereas XRP and Solana-linked merchandise noticed modest inflows, pointing to selective institutional repositioning reasonably than a wholesale exit from digital belongings.
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