U.S. spot bitcoin exchange-traded funds (ETFs) logged $648.6 million in net outflows on Monday, the largest daily withdrawal since January 29, according to SoSoValue data.
The move deepened recent weakness in the segment and followed last week’s $1 billion in net outflows, which ended a six-week streak of steady net inflows into the products. Monday marked the eighth consecutive session of net redemptions.
Major outflows hit U.S. spot bitcoin ETFs
U.S. spot bitcoin exchange-traded funds (ETFs) logged $648.6 million in net outflows on Monday, the largest daily withdrawal since January 29, according to SoSoValue data.
The move deepened recent weakness in the segment and followed last week’s $1 billion in net outflows, which ended a six-week streak of steady net inflows into the products. Monday marked the eighth consecutive session of net redemptions.
Blackrock’s IBIT leads withdrawals
The heaviest selling pressure came from Blackrock’s IBIT, which recorded $448.3 million in net outflows on the day.
Other major funds also saw sizable redemptions:
- ARKB, run by Ark and 21Shares, lost $109.6 million
- Fidelity’s FBTC registered $63.4 million in outflows
- Smaller products from Bitwise, VanEck, Invesco, and Franklin Templeton also posted net redemptions
The persistent withdrawals from these vehicles highlight a more cautious tone among market participants after an extended period of inflows earlier in the year.
Bitcoin hovers near key support after geopolitical and inflation shocks
Bitcoin traded below $77,000 after the weekend, giving back part of the gradual gains notched over several prior weeks. The move came as tensions between the U.S. and Iran, alongside a rise in oil prices, renewed concerns over inflation pressure.
The asset is currently fluctuating around a support band between $76,000 and $77,000. On a wider time frame, technicians point to a more critical floor in the $74,000 to $75,000 range.
Analysts say this lower band is a structurally important zone for maintaining the prevailing positive trend. A clean break below it could accelerate downside momentum, while a sustained defense may exhaust selling pressure and open room for a move back toward resistance near $78,500.
Higher treasury yields and risk-free returns weigh on demand
Market analysts cited rising U.S. treasury yields as a key driver behind the latest ETF outflows. As risk-free returns climb, other assets look relatively less attractive, prompting reallocations away from bitcoin-linked products.
With liquidity conditions still tight and inflation fears resurfacing, institutional desks have been making short-term portfolio adjustments, trimming exposure to higher-volatility assets and building cash buffers.
Stablecoin balances grow as cash sits on the sidelines
Parallel to the ETF outflows, leading stablecoins continue to expand in size. The combined market capitalization of major dollar-pegged tokens has climbed above $266 billion.
Tether’s USDT accounts for about $189 billion of that total, while Circle’s USDC stands near $77 billion.
The growth in stablecoin capitalization suggests that traders are parking significant sums in cash-like instruments, potentially waiting for clearer signals from macro policy or more attractive entry levels in bitcoin. The build-up of dollar-pegged liquidity is widely viewed as latent buying power that could reenter the market if prices weaken further or volatility settles.
Producer price data reinforces inflation worries
Complicating the outlook, the latest Producer Price Index showed wholesale inflation accelerating at its fastest pace in more than a year. The index for final demand rose 1.4 percent in April.
The surprise to the upside feeds into a broader narrative of persistent price pressures across the economy. Historically, such dynamics limit the Federal Reserve’s room to adopt a more accommodative stance and tend to keep policy biased toward tighter financial conditions.
Fed tone turns more hawkish as markets push back rate-cut hopes
Monetary policymakers have signaled a hawkish tilt in recent communications, with several officials emphasizing that interest rates may need to remain higher for longer — and could rise further — to contain inflation.
Officials have repeatedly stressed the need for more convincing evidence that inflation is trending sustainably lower before any policy easing can be considered.
This places Federal Reserve Chair Kevin Warsh in a sensitive position ahead of his first public appearance, where traders will scrutinize his tone on inflation and rates. Futures markets have already shifted expectations, now implying a high probability that current policy rates will stay in place through the end of 2026.
Sentiment turns cautious as redemptions stretch into second week
The extended run of ETF redemptions — now eight straight sessions of net outflows — underscores a cautious shift that has been building for more than a week. Data from institutional-grade products show a pattern of distribution, as capital is pulled back amid uncertainty over policy, yields, and inflation.
This sustained selling pressure has kept bitcoin’s price pinned just above the lower support area near $74,000–$75,000. Market participants are watching whether that floor holds as macro signals and central bank commentary continue to drive short-term volatility.
For deeper context on macro forces shaping BTC, explore Toobit Academy’s in-depth guide on interest rates and Bitcoin.
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