Over the past 30 days, a net $180 million has flowed out of U.S. spot bitcoin (BTC) ETFs, marking one of the highest rates of withdrawals since they began trading in early 2024. This significant outflow highlights a growing concern among investors in the current market dynamics.
The performance of bitcoin ETFs has disappointed in 2025, as sluggish inflows can largely be attributed to bitcoin’s weak price performance, which has experienced a decline of approximately 10%. Despite a recent brief uptick bringing in around $700 million in net inflows over the past five days, total net inflows since inception now stand at $36.1 billion, according to Farside data.
There are two primary factors contributing to the notable outflows over the past month: heightened volatility in bitcoin’s price and the unwinding of a strategy known as the basis trade.
This year has seen significant price fluctuation for bitcoin, which reached a record $109,000 in January, fueled by expectations of a crypto-friendly regulatory environment under President Donald Trump. However, it subsequently fell to a low of $76,000 by early March, amid concerns surrounding Trump’s tariff-based trade policy.
Retail investors often react emotionally during such periods of increased volatility, leading to heightened selling activity similar to behaviors observed with other risk assets. In contrast, institutional investors are unwinding the basis trade — a strategy that involves taking a long position in the ETF while simultaneously shorting CME bitcoin futures. The short position anticipates a drop in price, allowing investors to maintain a delta-neutral stance that capitalizes on the discrepancy between futures and spot pricing.
At present, this arbitrage opportunity yields only around 2%, the lowest rate seen since the ETFs’ approval. Many investors are now gravitating towards U.S. Treasuries, which are considered low-risk investments, particularly as they offer higher yields.
The dynamics of ETF inflows and outflows can often indicate market turning points. As evidenced in the past, aggressive outflows have historically coincided with local price bottoms for bitcoin. This trend was notably observed in March, alongside similar pullbacks in August 2024 and April 2024, suggesting that current conditions may present potential opportunities for investors who can identify and act on market pivots.
