US spot Bitcoin and Ethereum exchange-traded funds faced significant redemptions as the cryptocurrency market declined. According to SoSoValue data, the 12 listed US Bitcoin ETFs lost $484.9 million on October 7, marking their largest single-day outflow since June 25.
BlackRock's iShares Bitcoin Trust (IBIT) led the withdrawals with $207.7 million, followed by Fidelity's FBTC at $105.1 million and ARK 21Shares' ARKB at $101.7 million. During the same period, Ethereum ETFs recorded $160.9 million in withdrawals, bringing their five-session losses to $506.3 million, the largest since January.
Combined, Bitcoin and Ethereum ETFs lost approximately $646 million on October 7 as Bitcoin fell below $83,000 and Ethereum retreated toward $2,500. The selling coincided with rising US Treasury yields, a stronger dollar, and elevated oil prices.
Signs of Weakening Institutional Demand
The latest outflows followed an earlier slowdown in ETF inflows. Bitfinex analysts reported that Bitcoin ETF flows had become increasingly uneven after September's gains. Daily inflows averaged $341.7 million during mid-September's rally but fell to approximately $35 million per day over the five trading sessions through October 6.
Much of that remaining demand concentrated in BlackRock's IBIT, which attracted $536.2 million during those five sessions while other Bitcoin ETFs collectively lost $363.3 million. This concentration left the market dependent on a single fund, a support that weakened when IBIT joined the broader selling on October 7.
Bitcoin Below Investor Cost Basis
The reversal coincided with Bitcoin falling below the estimated flow-weighted average ETF cost basis at $84,318, according to Checkonchain data cited by Bitfinex. Historically, daily inflows moderated toward approximately $65 million as Bitcoin approached investors' aggregate breakeven level. With Bitcoin's close under $83,000, further declines could prompt additional redemptions as investors seek to limit losses.
Ethereum's Broader Weakness
Ethereum ETF redemptions reflected additional market pressures. Beyond persistent fund outflows, traders were increasingly taking short positions in derivatives markets, with negative perpetual futures funding rates indicating bearish traders' willingness to pay to maintain exposure to further price declines.
Bitfinex warned that weaker institutional inflows were leaving the broader altcoin market dependent on capital rotating among existing cryptocurrency positions, leaving smaller tokens particularly exposed if Bitcoin's decline accelerates.
