U.S. spot Bitcoin exchange-traded funds (ETFs) notched a massive $817 million net outflow on Thursday, as the leading cryptocurrency’s price plummeted to a nine-month low.
Bitcoin’s price crash“A streak of negative catalysts pushed Bitcoin to break its multi-week trading range to the downside,” Aurelie Barthere, Principal Research Analyst at Nansen, told Decrypt.
Barthere noted that Bitcoin’s correlation with U.S. equities has turned positive again. “Bitcoin sold off with equities following the market’s disappointment in Microsoft’s Q4 2025 financial results and its cautious guidance for 2026.”
The transition in Fed leadership is also fundamentally altering the “basis trade” that has sustained ETF volumes for months, Tim Sun, senior researcher at HashKey Group, told Decrypt.
“From a capital structure perspective, Bitcoin spot ETFs function as a critical channel for leveraged capital to engage in spot-futures and basis arbitrage,” Sun explained. He said that the market is repricing the interest rate path as the probability of Kevin Warsh becoming the next Fed Chair rises.
“This segment of capital is exceptionally sensitive to shifts in liquidity,” Sun said. “As investors lower their overall risk profiles, they are rotating out of high-volatility assets and into traditional safe-haven and inflation-hedge assets like gold.
This shift has amplified ETF outflows and contributed to the sluggishness in Bitcoin’s recovery.”
Other macro headwinds have compounded the pressure.
While a potential U.S. government shutdown was averted late Thursday by a Senate funding deal, the market remains on edge over Trump’s executive order declaring a national emergency regarding oil tariffs and ongoing tensions in the South China Sea.
“Flow-wise, we have been observing a slow capitulation in ETFs, options, and miner activity for some time,” Barthere added.
