- Holiday trading drained $782M from Bitcoin ETFs as institutions stepped back
- Bitcoin ETFs faced six straight outflow days amid thin Christmas liquidity
- Institutional retreat hit Bitcoin ETFs despite stable prices near $87,000
Spot Bitcoin exchange traded funds recorded heavy selling pressure during the Christmas period, according to SoSoValue. Investors withdrew a combined $782 million, signaling a clear retreat as holiday trading reduced market participation. During the week, outflows accelerated as liquidity thinned across US markets. The largest single day of selling occurred on Friday, when spot Bitcoin ETFs posted $276 million in net withdrawals.
BlackRock’s IBIT absorbed the biggest hit, with nearly $193 million exiting the fund. Fidelity’s FBTC followed with about $74 million in redemptions, reflecting broad based selling across major issuers. Meanwhile, Grayscale’s GBTC continued to record modest but persistent outflows. As a result, total net assets across US listed spot Bitcoin ETFs fell to around $113.5 billion by Friday.
Earlier in December, ETF assets had climbed above $120 billion, underscoring the scale of the pullback. However, Bitcoin prices remained relatively steady near $87,000, suggesting price resilience despite fund withdrawals.
Importantly, Friday marked the sixth consecutive session of net outflows for spot Bitcoin ETFs. Over this six day stretch, cumulative withdrawals exceeded $1.1 billion, marking the longest outflow streak since early autumn.
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Holiday trading pressures weigh on institutional positioning
According to Vincent Liu, chief investment officer at Kronos Research, holiday driven positioning often distorts ETF flows. He said reduced staffing and thinner liquidity typically lead institutions to trim exposure temporarily.
Moreover, Liu explained that many desks rebalance portfolios ahead of year end, which can pressure ETF flows. Consequently, these outflows may not reflect a fundamental shift in long term demand. He added that institutional activity usually resumes once normal trading conditions return in early January. Besides that, expectations around future monetary policy could help stabilize sentiment.
Rate markets currently price in roughly 75 to 100 basis points of potential cuts, pointing to easing momentum. Additionally, expanding bank led crypto infrastructure continues to reduce friction for large capital allocators.
Sustained ETF outflows raise caution signals
However, broader data suggests caution remains across the ETF landscape. According to Glassnode, Bitcoin and Ether ETFs have entered a sustained outflow phase since early November.
The firm reported that the 30 day moving average of net ETF flows has stayed negative. Consequently, this trend points to cooling institutional participation as global liquidity conditions tighten. As ETFs are widely viewed as a gauge of institutional sentiment, prolonged withdrawals indicate reduced risk appetite. Significantly, institutions had been a major driver of crypto market strength earlier in the year.
Overall, the $782 million ETF drain highlights how holiday trading can trigger short term investor retreats.
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