Bitcoin ETF Outflows Hit $194.6M as IBIT ETF Drops to $50.69

Bitcoin ETFs Face $194.6 Million Outflow as IBIT (NASDAQ:IBIT) Leads Withdrawals and Market Awaits Fed Signal

IBIT (NASDAQ:IBIT) Pullback Marks Largest ETF Exit Since November 20

The iShares Bitcoin Trust ETF (NASDAQ:IBIT) closed at $50.69, down 3.47% on the day, after hitting an intraday low of $50.04. The ETF’s decline came amid a massive $194.6 million combined outflow from all U.S.-listed Bitcoin ETFs on Thursday — the largest single-day withdrawal since November 20.
BlackRock’s IBIT alone accounted for $112.9 million of that total, representing over 58% of net redemptions. Fidelity’s FBTC followed with $54.2 million in outflows, while VanEck’s HODL, Grayscale’s GBTC, and Bitwise’s BITB also reported redemptions. Trading volume across all spot Bitcoin ETFs fell sharply to $3.1 billion, down from $4.2 billion a day earlier, signaling waning institutional activity ahead of key U.S. inflation and Federal Reserve data.

BTC-USD Consolidates Below $90,000 as ETF Flows Shift to Defensive Mode

Bitcoin (BTC-USD) slipped 1.4% over the last 24 hours, trading around $89,439 after recovering from a brief dip near $84,000 earlier in the week. The coin remains under pressure as futures-spot spreads narrow below break-even, forcing arbitrage funds to unwind basis trades. Analysts from LVRG Research report that leveraged desks closed positions as the CME premium collapsed, draining liquidity from Bitcoin ETFs and dragging down IBIT along with other spot products.
Market sentiment turned cautious as accumulation slowed and exchange inflows climbed. Glassnode data show exchange balances at 1.8 million BTC, the lowest level since 2017 — evidence that long-term holders continue to withdraw coins from exchanges, while short-term participants rotate into cash ahead of macro catalysts.

ETF Rotation Highlights Diverging Investor Sentiment Across Assets

The flight from Bitcoin ETFs stands in stark contrast to rising inflows into XRP ETFs, which logged $10.23 million in net purchases on Friday, bringing total holdings to $861.23 million. Investors are gradually diversifying across regulated altcoin products, with XRP’s momentum echoing the early adoption stage of BTC spot ETFs in 2024. Meanwhile, Ethereum ETFs reversed sharply with $41.6 million in outflows, led by Grayscale’s ETHE, reflecting cautious positioning in anticipation of the Fed’s December 10 policy announcement.
Institutional investors appear to be temporarily rotating out of Bitcoin exposure toward shorter-duration risk assets, waiting for confirmation that rate cuts will materialize. Bank of America expects a 25 bps cut this month and two additional in 2026, but traders remain skeptical until official guidance is issued.

Bitcoin ETF Market Dynamics — From Launch Euphoria to Structural Consolidation

The current retracement marks a notable shift from the exuberance seen earlier in the year when cumulative Bitcoin ETF inflows exceeded $57 billion within the first 20 months of trading. Since the January 2024 approval, IBIT and FBTC have dominated the landscape, capturing nearly 75% of all spot ETF volume. The recent $194.6 million withdrawal, though significant, represents less than 0.35% of total Bitcoin ETF assets under management — suggesting that the move is corrective rather than panic-driven.
At its 2025 peak, IBIT’s price reached $71.82, marking a 67% premium from its year low of $42.98. The ETF’s current valuation near $50.69 keeps it 29% below its mid-year average, but technicals indicate solid support around $49.80–$50.00, where institutional bids are expected to stabilize price action.

Correlation Between ETF Flows and BTC-USD Price Action

Since their debut, Bitcoin spot ETFs have shown a 0.87 correlation with the underlying asset. Thursday’s pullback coincided with Bitcoin’s slip below $90,000, highlighting how ETF redemptions amplify volatility. Analysts note that each $100 million in ETF outflows typically translates into a 0.6–1.0% downward move in BTC spot pricing within 24 hours, depending on liquidity depth.
However, derivatives data show resilience. Open interest on CME Bitcoin futures stands at $5.9 billion, only 3% off November highs, indicating that institutional hedging remains active rather than withdrawn. This structure implies that the pullback is flow-based, not a fundamental unwind.

Institutional Positioning and Market Behavior

Institutional metrics from Coinbase Prime confirm steady BTC accumulation in custody accounts, even as ETFs record withdrawals. This divergence underscores a shift toward direct exposure among high-net-worth investors, possibly due to fee differentials and custody preferences. Meanwhile, IBIT’s daily trading volume remains healthy at 68.71 million shares, reflecting strong liquidity despite short-term price declines.
Whale activity mirrors this pattern. CryptoQuant reports large wallet addresses accumulating between $88,000–$90,000, signaling confidence that BTC’s current weakness represents a rebalancing window rather than a reversal trend.

Comparative Performance — IBIT vs. BTC Price Index

Since its inception, IBIT has returned +18.2% YTD, outperforming the broader Bitcoin spot price, which gained +14.9% YTD as of December 6. The ETF’s tracking precision remains within 0.15% of NAV, underscoring operational efficiency despite volatile market conditions. In contrast, GBTC’s discount-to-NAV widened to –4.8%, reinforcing IBIT’s appeal as the institutional benchmark.

Liquidity Compression and Basis Unwinds

Market specialists attribute the latest exodus to basis trade compression, where the futures premium over spot BTC briefly turned negative. As spreads collapsed below 0.2%, arbitrage desks exited positions, converting futures gains into USD while redeeming ETF shares. This mechanical unwinding, rather than investor panic, accounts for most of the $194.6 million flow reduction. Analysts view it as a liquidity cycle adjustment, not a change in the macro thesis for Bitcoin.

Macroeconomic Backdrop — Fed Policy and Inflation Outlook

The Federal Reserve’s upcoming December 10 meeting remains the dominant narrative for all Bitcoin-linked instruments. A dovish tone confirming the first 25 bps rate cut could spark renewed risk-on sentiment and reverse ETF outflows as early as mid-December. Conversely, a hawkish hold may extend ETF selling pressure into year-end. Bitcoin’s resilience near the $89,000–$90,000 band, even under tightening conditions, highlights its evolving role as a high-beta macro hedge rather than purely speculative asset.

Market Position and Technical Perspective for IBIT

Technically, IBIT remains in a corrective phase. The 50-day moving average sits at $54.40, while the 200-day rests at $49.10, forming a consolidation wedge. A breakout above $52.00 would reassert bullish control, targeting $56.50. Below $50.00, momentum sellers could test $48.20, aligning with the ETF’s lower Bollinger boundary.
Relative Strength Index (RSI) stands at 43, near neutral territory, showing neither oversold nor overbought conditions. Analysts suggest that accumulation near $50.00–$50.50 offers asymmetric risk for medium-term investors ahead of potential policy easing.

Verdict: Short-Term Neutral, Long-Term Bullish Bias

Despite the sharp outflow, the underlying structure of Bitcoin ETFs, led by IBIT (NASDAQ:IBIT), remains robust. Institutional participation has not vanished; it has repositioned. With Bitcoin supply tightening, stable on-chain accumulation, and a likely dovish Fed tilt ahead, the setup favors a medium-term recovery toward $97,000–$106,000 for BTC-USD and a return to the $55–$60 range for IBIT. The data suggest short-term caution but long-term strength, affirming a Buy on Weakness stance.

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