Bitcoin triggers $7B loss for ETF holders as price could drop to $65,000 while Strategy (MSTR) sits on billion dollar cushion
Bitcoin’s slide under $80,000 has pushed a good portion of US spot BTC exchange-traded fund (ETF) consumers into $7 billion in paper losses.
According to CryptoSlate’s information, the world’s largest digital asset fell to as low as $74,609 over the weekend amid liquidity considerations and a risk-off tone in global markets. BTC has recovered to roughly $77,649 as of press time.
Alex Thorn, Galaxy Digital’s head of analysis, famous that this price efficiency signifies that Bitcoin is buying and selling under the common value foundation of US ETFs. Notably, spot Bitcoin ETF buyers are holding common paper losses of roughly 15%, implying a median entry price of roughly $90,200 per Bitcoin.
That setup can change conduct. Unlike self-custody consumers, who typically tolerate sharp swings, ETF holders embody advisers and allocators who rebalance in accordance to predefined portfolio guidelines. When the common holder is down, rallies can run into “sell-to-even” promoting.
When costs fall once more, some buyers scale back publicity to mitigate threat, particularly if volatility rises and Bitcoin continues to transfer in keeping with equities.
Considering this, some business specialists argued that the numerous drawdown raises the stakes about whether or not the present redemption streak from the 12 ETF merchandise will evolve from a tactical pause right into a sustained market headwind.
Who’s underwater, and by how a lot?
The extent of the injury is changing into clearer by means of on-chain and fund-flow analyses.
Jim Bianco of Bianco Research highlighted that the 12 spot Bitcoin ETFs now maintain roughly 1.29 million Bitcoin, price over $115 billion. These funds collectively maintain roughly 6.5% of all Bitcoin in circulation.
When mixed with the company treasury of Strategy (formerly MicroStrategy), the ETF holdings characterize 10% of all Bitcoin.
However, their entry factors differ drastically. Strategy has been shopping for Bitcoin since 2020, averaging $76,020 per buy, leaving it with an unrealized revenue of simply $1.17 billion, down from over $30 billion final October.
In distinction, the ETF buyers arrived later and paid larger costs.
Bianco famous that the 12-spot Bitcoin ETFs have a median buy price of roughly $90,200, roughly $13,000 (16%) above present costs.
Combined, the common buy price of the ETFs is $85,360, indicating a median loss of roughly $8,000. This represents an unrealized loss of roughly $7 billion for these buyers.
Essentially, that locations the common Bitcoin ETF purchaser underwater.
James Check of Checkonchain added one other layer of nuance, stating that if one assumes a price foundation of inflows on the day they occurred, 62% of ETF inflows are actually underwater.
US Bitcoin ETFs are bleeding funds
Meanwhile, the Bitcoin ETF holders’ losses have arrived alongside a pronounced shift in capital flows.
Across the 12 spot Bitcoin ETFs, internet outflows have totaled roughly $6.18 billion from November 2025 by means of January 2026. This is the longest month-to-month outflow streak since these merchandise launched in 2024.
Notably, the redemptions have been punctuated by massive day by day drawdowns.
For context, SoSo Value information present that the merchandise recorded internet redemptions totaling greater than $1.3 billion within the final two buying and selling days of January, alongside a 9-day outflow streak, punctuated by a modest influx of $6.3 million.
When outflows happen in bursts, the market has much less time to soak up the availability, which may exacerbate intraday volatility. In episodes like this, Bitcoin typically trades like a high-beta macro asset.
Essentially, the outflows characterize a reversal of fortunes for BTC ETFs, which had beforehand been a constant supply of demand for the main cryptocurrency.
How a lot Bitcoin the market should swallow
The ahead query for the market is primary supply-and-demand math: what occurs to Bitcoin’s price discovery if the outflow pattern persists?
If the ETF advanced continues to shed greater than $6 billion each three months, the implied month-to-month tempo is roughly $2 billion in internet outflows.
At a hypothetical $75,000 Bitcoin price, this corresponds to roughly 27,000-28,000 BTC per thirty days that different consumers should soak up.
If costs fall, the identical dollar outflow corresponds to extra BTC, thereby growing the quantity that have to be absorbed elsewhere.
That determine seems to be even bigger compared with Bitcoin’s post-halving issuance schedule. The 2024 halving reduced the block reward to 3.125 BTC, leaving the common new provide at roughly 450 BTC per day, or roughly 13,500 BTC per thirty days.
Sustained ETF redemptions on the latest tempo would due to this fact quantity to a provide equal to about two months of recent issuance each single month.
Unless different demand sources re-emerge, this imbalance can weigh on sentiment and additional depress the BTC price.
Why promoting can feed extra promoting
The relationship between ETF flows and price motion is statistically vital, and the client combine helps clarify this relationship.
A report from K33 Research final yr discovered that Bitcoin’s price stays intently tied to ETF flows, with an R-squared of 0.80, accounting for roughly 80% of the variance in 30-day BTC returns.
Bianco pointed to the common commerce measurement as a actuality test on who is definitely driving exercise in these funds. While the common commerce for the SPDR S&P 500 ETF Trust (SPY) is $111,300 and the SPDR Gold Shares (GLD) is $87,000, the common commerce for Bitcoin ETFs is simply $15,800.
According to him, that profile seems extra like brokerage retail than long-duration institutional positioning.
If the marginal ETF holder, like Bianco identified, is extra retail-like, flows can grow to be extra “price-driven.”
In plain phrases: when costs fall, extra buyers could determine to get out, and people exits present up as redemptions. Redemptions then drive sponsors to sell spot Bitcoin to meet money withdrawals, which may push the price down once more.
Considering this, CryptoSlate’s evaluation suggests the mid-$75,000s could present assist if consumers step in.
If the Bitcoin price holds these areas and flows stabilize, ETFs could revert from being a supply of provide to a marginal purchaser once more. This would cut back the mechanical provide overhang and probably dampen market volatility.
However, if outflows persist, BTC could face vital headwinds that could additional depress its price. Alphractal CEO Joao Wedson famous that the following main assist degree for BTC is roughly $65,500 in such situations.
The submit Bitcoin triggers $7B loss for ETF holders as price could drop to $65,000 while Strategy (MSTR) sits on billion dollar cushion appeared first on CryptoSlate.
