Bitcoin’s slide beneath $80,000 has pushed a good portion of US spot BTC exchange-traded fund (ETF) patrons into $7 billion in paper losses.
Based on CryptoSlate’s information, the world’s largest digital asset fell to as little as $74,609 over the weekend amid liquidity considerations and a risk-off tone in international markets. BTC has recovered to roughly $77,649 as of press time.
Alex Thorn, Galaxy Digital’s head of analysis, famous that this value efficiency signifies that Bitcoin is buying and selling beneath the typical value foundation of US ETFs. Notably, spot Bitcoin ETF traders are holding common paper losses of roughly 15%, implying a median entry value of roughly $90,200 per Bitcoin.
That setup can change conduct. Not like self-custody patrons, who typically tolerate sharp swings, ETF holders embrace advisers and allocators who rebalance in line with predefined portfolio guidelines. When the typical holder is down, rallies can run into “sell-to-even” promoting.
When costs fall once more, some traders scale back publicity to mitigate danger, particularly if volatility rises and Bitcoin continues to maneuver in line with equities.
Contemplating this, some trade specialists argued that the numerous drawdown raises the stakes about whether or not the present redemption streak from the 12 ETF merchandise will evolve from a tactical pause right into a sustained market headwind.
Who’s underwater, and by how a lot?
The extent of the injury is turning into clearer by on-chain and fund-flow analyses.
Jim Bianco of Bianco Analysis highlighted that the 12 spot Bitcoin ETFs now maintain roughly 1.29 million Bitcoin, value over $115 billion. These funds collectively maintain roughly 6.5% of all Bitcoin in circulation.
When mixed with the company treasury of Technique (previously MicroStrategy), the ETF holdings signify 10% of all Bitcoin.
Nonetheless, their entry factors differ drastically. Technique has been shopping for Bitcoin since 2020, averaging $76,020 per buy, leaving it with an unrealized revenue of simply $1.17 billion, down from over $30 billion final October.
In distinction, the ETF traders arrived later and paid increased costs.
Bianco famous that the 12-spot Bitcoin ETFs have a median buy value of roughly $90,200, roughly $13,000 (16%) above present costs.
Mixed, the typical buy value of the ETFs is $85,360, indicating a median lack of roughly $8,000. This represents an unrealized lack of roughly $7 billion for these traders.
Primarily, that locations the typical Bitcoin ETF purchaser underwater.
James Test of Checkonchain added one other layer of nuance, stating that if one assumes a value foundation of inflows on the day they occurred, 62% of ETF inflows are actually underwater.
US Bitcoin ETFs are bleeding funds
In the meantime, the Bitcoin ETF holders’ losses have arrived alongside a pronounced shift in capital flows.
Throughout the 12 spot Bitcoin ETFs, web outflows have totaled roughly $6.18 billion from November 2025 by January 2026. That is the longest month-to-month outflow streak since these merchandise launched in 2024.
Notably, the redemptions have been punctuated by massive day by day drawdowns.
For context, SoSo Worth information present that the merchandise recorded web redemptions totaling greater than $1.3 billion within the final two buying and selling days of January, alongside a 9-day outflow streak, punctuated by a modest influx of $6.3 million.
When outflows happen in bursts, the market has much less time to soak up the availability, which may exacerbate intraday volatility. In episodes like this, Bitcoin typically trades like a high-beta macro asset.
Primarily, the outflows signify a reversal of fortunes for BTC ETFs, which had beforehand been a constant supply of demand for the main cryptocurrency.
How a lot Bitcoin the market should swallow
The ahead query for the market is fundamental supply-and-demand math: what occurs to Bitcoin’s value discovery if the outflow pattern persists?
If the ETF complicated continues to shed greater than $6 billion each three months, the implied month-to-month tempo is roughly $2 billion in web outflows.
At a hypothetical $75,000 Bitcoin value, this corresponds to roughly 27,000-28,000 BTC per 30 days that different patrons should soak up.
If costs fall, the identical greenback outflow corresponds to extra BTC, thereby growing the quantity that should be absorbed elsewhere.
That determine seems to be even bigger in comparison with Bitcoin’s post-halving issuance schedule. The 2024 halving lowered the block reward to three.125 BTC, leaving the typical new provide at roughly 450 BTC per day, or roughly 13,500 BTC per 30 days.
Sustained ETF redemptions on the latest tempo would due to this fact quantity to a provide equal to about two months of latest issuance each single month.
Except different demand sources re-emerge, this imbalance can weigh on sentiment and additional depress the BTC value.
Why promoting can feed extra promoting
The connection between ETF flows and value motion is statistically vital, and the customer combine helps clarify this relationship.
A report from K33 Analysis final yr discovered that Bitcoin’s value stays carefully tied to ETF flows, with an R-squared of 0.80, accounting for about 80% of the variance in 30-day BTC returns.
Bianco pointed to the typical commerce measurement as a actuality examine on who is definitely driving exercise in these funds. Whereas the typical commerce for the SPDR S&P 500 ETF Belief (SPY) is $111,300 and the SPDR Gold Shares (GLD) is $87,000, the typical commerce for Bitcoin ETFs is simply $15,800.
Based on him, that profile seems extra like brokerage retail than long-duration institutional positioning.
If the marginal ETF holder, like Bianco identified, is extra retail-like, flows can turn into extra “price-driven.”
In plain phrases: when costs fall, extra traders might determine to get out, and people exits present up as redemptions. Redemptions then drive sponsors to promote spot Bitcoin to fulfill money withdrawals, which may push the value down once more.
Contemplating this, CryptoSlate’s evaluation suggests the mid-$75,000s may present help if patrons step in.
If the Bitcoin value holds these areas and flows stabilize, ETFs may revert from being a supply of provide to a marginal purchaser once more. This would cut back the mechanical provide overhang and doubtlessly dampen market volatility.
Nonetheless, if outflows persist, BTC may face vital headwinds that would additional depress its value. Alphractal CEO Joao Wedson famous that the subsequent main help degree for BTC is roughly $65,500 in such situations.
