Bitcoin ETFs post biggest one-day outflow since June
Macro & Markets ·
Spot Bitcoin funds shed $484.9 million on Oct. 7 as oil near $100 and 30-year Treasury yields at their highest since 2002 pushed investors toward safer, higher-yielding assets.
Spot Bitcoin ETFs recorded $484.9 million in net outflows in a single trading session, the largest daily withdrawal since June 25, according to Decrypt. BlackRock's IBIT accounted for the largest share of the exodus, while Fidelity's FBTC followed with roughly $105.1 million pulled out. A separate tally put total outflows from U.S. spot Bitcoin and Ethereum ETFs at $487 million and $161 million respectively for the day, with BlackRock's products again leading withdrawals, according to wublockchain.xyz.
The single session wiped out roughly 81% of the inflows gathered over the prior nine trading days, though the funds retain $57.8 billion in cumulative net inflows, meaning the pullback is sharp but not a wholesale reversal. The timing coincided with a broader shift in macro conditions: the 30-year Treasury yield rose to about 5.7%, its highest level since 2002, Brent crude settled near $100 a barrel, and equities slipped from record highs. Repeated ship attacks near the Strait of Hormuz, occurring at least once a day since Oct. 2, have kept upward pressure on oil prices.
The mechanics linking these moves are straightforward: costlier oil feeds inflation, inflation keeps the Federal Reserve inclined toward tighter policy, and that keeps bond yields elevated. For an asset like Bitcoin that generates no yield through an ETF wrapper, a 10-year Treasury paying above 5% becomes a more attractive alternative for institutional allocators weighing risk against return. Minutes from the Fed's most recent meeting, released the same day, showed most officials anticipate another rate hike before year end, even though market-implied odds remain skeptical — CME Fedwatch prices an October hike at 19.4% and Myriad at 17%.
The outflows coincided with a broader price slide: Bitcoin fell as low as $81,749.83, about 6% below the $86,978 level it touched earlier in the week, while roughly $429 million in derivatives positions were liquidated over 24 hours, with long bets making up 87.5% of that total. The pullback also ended a six-year pattern of positive October performance that had held until 2024's 3.69% decline; this year's funds opened the month with $321.6 million in inflows before swinging to a $163.3 million deficit through Oct. 7.
What remains unresolved is whether the Fed will actually hike again, with the next policy meetings set for Oct. 27-28 and Dec. 8-9 and no firm date set in the September minutes for further tightening. Whether ETF flows stabilize or continue eroding will likely hinge on how oil prices and bond yields move in the weeks ahead.