Spot BTC ETFs fail to sure up Bitcoin decline as outflow streak hits $1.9B

Spot Bitcoin ETFs saw a strong outflow of $566.4 million on Tuesday, November 4, extending their five-day drain to about $1.9 billion and decisively changing the tone of the week in risk-off.

Fidelity FBTC accounted for most of the exits at -$356.6 million, with ARKB to – $128.1 million and The gray scale GBTC to – $48.9 million. No fund posted an inflow.

This is the largest one-day flow since August 1, a new high for redemptions in the second half of the year. The five-day tally is now close to $1.9 billion.

Bitcoin price action offers little cushioning to the ETF market. Bitcoin briefly dipped below the coveted $100,000 level on major US exchanges on Tuesday before stabilizing just above $100,000 on Wednesday morning. The aggregated data puts the average price of Bitcoin on November 4 at $101,475, with the hours of November 5 bringing little upside to the price.

Yesterday’s flow was concentrated in Fidelity’s FBTC, while ARKB and GBTC added notable, but significantly smaller redemptions. It’s a notable change from Monday’s streams, where BlackRock IBIT accounted for almost all flows.

The setup leading into the second half of the week is now pretty simple. With Bitcoin struggling to find stability at $100,000 and experiencing increasing volatility, the upcoming ETF press will have a significant impact on sentiment in the near term. Another significant redemption in the next two to three days reinforces the idea that de-risking is now expressed through the largest and most liquid wrappers. It will take more than a single day of net creations to reverse this feeling of risk.

When analyzing the macro context behind ETF flows, it is important to focus on the classic feedback loop: flows influence AP coverage and inventory, which then influences spot liquidity, which then influences derivatives positioning and funding. That cycle can easily loosen or tighten in a couple of trading days.

Given the scale and concentration of Tuesday’s flows, we will be closely watching the next press of FBTC, the persistence of GBTC flows, and whether ARKB redemptions continue in size. If the streak breaks, and we see a large bottom as IBIT posting inflows again, there is a good chance that the price of Bitcoin will be able to find support above $100,000. If these outflows widen, the market will have to absorb a new wave of selling pressure at a time when liquidity and confidence are already in short supply.