Assets held in US spot Bitcoin exchange traded funds dropped below the $100 billion mark on Tuesday as investors pulled money from funds amid a sharp downturn in the broader cryptocurrency market.
Data from SoSoValue shows that spot Bitcoin ETFs recorded $272 million in net outflows on Tuesday. This pushed total assets under management below $100 billion for the first time since April 2025. The decline marks a sharp reversal from October, when assets peaked near $168 billion, highlighting how quickly market sentiment has shifted.
The drop in ETF assets came as Bitcoin prices weakened significantly. The world’s largest cryptocurrency fell below $74,000 during Tuesday’s trading session, adding pressure across the digital asset space.
Losses were not limited to Bitcoin alone. The overall crypto market also saw heavy selling, with total market value falling from $3.11 trillion to $2.64 trillion over the past week, according to CoinGecko data. The pullback reflects growing caution among investors as volatility remains high.
ETF outflows resumed after a brief rebound in demand earlier in the week. On Monday, spot Bitcoin ETFs saw $562 million in net inflows, their strongest single day of inflows since mid January. However, that recovery proved short lived, as funds returned to net outflows the following day.
With Tuesday’s withdrawals, year to date outflows from spot Bitcoin ETFs have now reached nearly $1.3 billion. Market participants say the renewed selling highlights fragile confidence and uncertainty in the current crypto environment.
Pressure on ETF flows has increased as Bitcoin trades below the estimated ETF creation cost basis of $84,000. This means new ETF shares are being created at a loss, which can discourage fresh investment and weigh further on demand.
While Bitcoin ETFs struggled, some alternative crypto funds showed modest strength. ETFs linked to Ether, XRP, and Solana recorded net inflows of $14 million, $19.6 million, and $1.2 million, respectively. This suggests that some investors are selectively shifting exposure rather than exiting crypto entirely.
Despite the decline in assets, analysts have played down fears of a mass sell off. ETF analyst Nate Geraci said most investors in spot Bitcoin ETFs are likely to hold their positions regardless of short term price moves.
Analysts note that many ETF buyers entered the market with a long term outlook. As a result, while daily flows may remain volatile, the risk of a disorderly exit appears limited for now.
Bitcoin showed mild signs of stabilization on Wednesday, trading above $76,000 after falling to its lowest levels since early November 2024 a day earlier. However, sentiment in derivatives markets remains cautious, suggesting traders are still bracing for further downside.
Some market participants continue to see the broader trend as bearish, with potential downside targets near the $70,000 level if selling pressure persists.
Geopolitical tensions have also weighed heavily on risk appetite. Bitcoin dropped below $73,000 on Tuesday after reports that the US military shot down an Iranian drone that approached the USS Abraham Lincoln aircraft carrier in the Arabian Sea.
The incident added to global uncertainty and reduced investor willingness to take risks in speculative assets like cryptocurrencies. Although diplomatic talks between the US and Iran are expected later this week, disagreements over the format and location of discussions have added further uncertainty to the outlook.