“Institutions fled first” as Bitcoin plunges, $400 million in capital exits
“Institutions fled first” as Bitcoin plunges, $400 million in capital exits
As Bitcoin (BTC) prices plunged and threatened the psychological support level of $60,000, more than $400 million in capital flowed out of the U.S. spot Bitcoin exchange-traded fund (ETF) market in a single day.
According to cryptocurrency news outlet Cointelegraph on February 6 (local time), a total net outflow of $434.8 million occurred from U.S. spot Bitcoin ETFs on February 5, sharply freezing investor sentiment. As Bitcoin prices tumbled to the low $60,000 range, institutional investors began withdrawing funds en masse as part of risk management. Data from Farside Investors show that this outflow marked the largest since late January.
By product, the Fidelity Wise Origin Bitcoin Fund (FBTC) suffered the biggest blow, with $254.5 million in outflows. This was followed by $138.4 million exiting the Grayscale Bitcoin Trust (GBTC), while the Bitwise Bitcoin ETF (BITB) saw $61.2 million leave. BlackRock’s IBIT recorded a modest net inflow of $33.6 million and stood alone in holding the line, but it was insufficient to counter the broader selling pressure across the market.
Bitcoin prices have given back most of the gains made after Donald Trump’s election as U.S. president and are now testing the $60,000 support level. Following outflows exceeding $1 billion from U.S. spot ETFs on January 30, another wave of large-scale withdrawals just a week later has led to assessments that the momentum of the so-called “Trump rally” has effectively dissipated. Ethereum (ETH) spot ETFs also recorded net outflows of $161 million on the same day, highlighting a deepening supply-demand imbalance across the digital asset market.
Eric Balchunas, senior ETF analyst at Bloomberg Intelligence, noted that “Bitcoin’s price decline is triggering stop-loss selling among ETF investors.” He added that it is a critical moment to watch whether the current situation represents more than a short-term price correction and instead signals the onset of a structural downturn. Concerns are also rising as pressure from the futures market is spilling over into the spot ETF market, with approximately $280 million worth of long positions liquidated over a 24-hour period.
The digital asset market is facing extreme volatility amid policy uncertainty under the Trump administration and broader macroeconomic instability. With inflows into Bitcoin spot ETFs slowing and large-scale outflows recurring, the market is expected to undergo continued turbulence focused on testing support levels rather than a swift price recovery. As institutional investors accelerate their exit, there is a growing need for substantial demand inflows to restore the market’s endogenous rebound momentum.
*Disclaimer: This article is for investment reference only, and no responsibility is taken for losses resulting from investment decisions based on it. The content should be interpreted solely for informational purposes.*
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