Seven-day Bitcoin ETF rally ends as $164M exits market during crypto decline
A week-long streak of positive flows into US spot Bitcoin ETFs comes to a halt with $163.5 million in withdrawals as investors grow increasingly cautious amid Middle Eastern geopolitical tensions and economic volatility.
A sustained period of capital inflows into US spot Bitcoin exchange-traded funds (ETFs) came to an abrupt end alongside a decline in BTC prices following a seven-day run that brought in $1.2 billion in fresh investments.
According to data from Farside, spot Bitcoin (BTC) ETFs experienced net withdrawals totaling $163.5 million on Wednesday.
Leading the exodus was the Fidelity Wise Origin Bitcoin Fund (FBTC) with approximately $104 million in outflows, while BlackRock's iShares Bitcoin Trust ETF (IBIT) followed with $34 million in redemptions.
Prior to Wednesday's outflow of $163.5 million, the exchange-traded funds were approximately $100 million away from achieving positive flows for the year-to-date period, concluding what had been their most extended run of consecutive inflows since October 2025.
This shift in momentum occurred as Bitcoin's price dropped beneath the $71,000 threshold on Wednesday, following an earlier climb above $75,000 during the week, triggering a resurgence of extreme fear throughout the investor community.
Altcoin ETFs share the negative sentiment with minor losses
This bearish momentum extended beyond Bitcoin to impact altcoin ETFs, with Ether (ETH) products experiencing the most significant withdrawals at approximately $56 million, based on Farside data.
Mirroring the pattern seen in Bitcoin funds, Fidelity Investments topped the outflow charts as the Fidelity Ethereum Fund (FETH) recorded investor redemptions totaling $37 million, with the Grayscale Ethereum Trust (ETHE) following at $9 million in net outflows.
Solana (SOL) ETFs experienced relatively modest losses of approximately $300,000, while XRP (XRP) exchange-traded funds registered zero net inflows.
Market participant sentiment deteriorated throughout trading hours, with the Crypto Fear & Greed Index momentarily climbing back to a reading of 26, classified as "Fear," on Wednesday before sliding back into "Extreme Fear" territory by Thursday.
Kyle Rodda, senior financial market analyst at Capital.com, emphasized the delicate nature of market sentiment that has been fueling the recent volatility in cryptocurrency prices.
"The price-action screams of a market that's run out of puff and maybe poised for protracted downside,"
Rodda said.
His analysis pointed to escalating inflation concerns, climbing energy costs resulting from the Israel-Iran conflict, and a comprehensive reassessment of interest rate expectations following the Fed's upward revision of its inflation projections, all contributing to investor hesitation.
In a Wednesday announcement, the Federal Open Market Committee (FOMC) declared it would maintain the Federal Funds rate unchanged at 3.5-3.75%, citing the need to assess macroeconomic consequences arising from the continuing military conflict in the Middle East.
During his remarks, Federal Reserve Chairman Jerome Powell characterized inflation as remaining "somewhat elevated" relative to the Fed's 2% benchmark target, underscoring the economic unpredictability resulting from Middle Eastern geopolitical developments.