$500 Million Floods Into Spot Bitcoin ETFs in a Single Day… Last Chance to Ride the Relief Rally?

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[$500 Million Barrage! Spot Bitcoin ETF Becomes a Black Hole for Capital—Last Chance to Ride the $68,000 Relief Rally?]

After suffering five consecutive weeks of painful outflows, the spot Bitcoin (BTC) ETF market saw more than $500 million in massive institutional capital pour in within a single day, strongly supporting Bitcoin’s reclaiming of the $68,000 level.

According to investment outlet FXStreet on February 26 (local time), citing SoSoValue data, U.S. spot Bitcoin ETFs recorded $506.5 million in inflows on Wednesday, marking the largest single-day inflow since February 2. Achieving strong net inflows for two consecutive days, Bitcoin is beginning to rebound after a devastating wave of selling in February that wiped out $20 billion in net assets. Weekly inflows have already surpassed $560.4 million.

Leading the glamorous return of institutional investors was BlackRock. According to Farside data, BlackRock’s iShares Bitcoin Trust (IBIT) absorbed $297.4 million in a single day, taking a commanding lead. Bitwise’s spot Bitcoin ETF (BITB) and Fidelity’s Wise Origin Bitcoin Fund (FBTC) followed with inflows of $39.4 million and $30.1 million, respectively. Trading volume also exceeded $4.3 billion, reaching its highest level since February 9 and reflecting strong investor sentiment.

However, it may be too early to pop the champagne, as underlying market concerns persist. Despite the significant inflows, controversy over so-called “paper Bitcoin”—in which large market makers and authorized participants (APs) such as Jane Street allegedly disrupt Bitcoin prices through derivatives—has become a hot topic. Following a recent lawsuit by Terraform Labs administrator Todd Snyder, suspicions of market manipulation have been rapidly spreading on X.

Jeff Park, an advisor at Bitwise, noted that while authorized participants may not overtly suppress prices, the very structure of the system could undermine the integrity of the price discovery mechanism—arguing that this represents a far more serious and structural issue than a mere conspiracy theory. Analysts have also expressed deep skepticism about the possible involvement of major players in the market, citing persistent selling pressure that has continued since last October.

Concerns about paper Bitcoin—where assets are traded on the books without full backing by actual cryptocurrency holdings—gained further traction earlier this month when The Kendall Report identified spot Bitcoin ETFs as a potential cause. Adding to the unease, South Korea’s Bithumb exchange recently experienced an unprecedented system error that mistakenly distributed 620,000 Bitcoin it did not possess. As a result, investors’ sharp vigilance over market transparency and integrity is unlikely to subside anytime soon.

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