On-chain data highlights a concerning trend for Bitcoin spot exchange-traded funds (ETFs), revealing that the spot price has dipped below the cost basis of nearly two-thirds of recent inflows.
62% of US Bitcoin Spot ETF Inflows Now at a Loss
In a recent post, noted on X, analyst Checkmate shared a revealing chart detailing the current landscape for Bitcoin spot ETFs. These funds, which provide investors indirect exposure to Bitcoin, have gained popularity since their initial approval by US regulators in January 2024. However, with the recent bearish shift in the cryptocurrency market, the situation looks grim for these investment vehicles.
Over the past two weeks, Bitcoin spot ETFs have experienced unprecedented net outflows, as investors react to the overall downturn in the crypto sector. The latest figures indicate net outflow spikes of $1.33 billion and $1.49 billion, marking the third and second largest outflow events in the history of these funds. The combination of substantial outflows and the Bitcoin price plummeting below the $80,000 mark has resulted in most capital held within these ETFs now trading at a loss.
The chart shared by Checkmate indicates that the average cost basis of the Bitcoin spot ETFs has fallen below the current trading price, aligning with a dashed line representing this breakeven point. Approximately 62% of ETF inflows are now underwater – a shocking revelation, given that until recently, holders had largely experienced gains since the launch of these ETFs.
Historical data shows that while there was a brief period in mid-2024 when Bitcoin dipped below the cost basis of ETF holders, it never struggled for long. Now, however, investors may find themselves grappling with the reality of a bear market, something that has not been a significant concern since the launch of these funds. Checkmate noted that unless there is a significant price recovery, the impacts of this latest price drop could lead to a challenging experience for ETF investors.
Current Bitcoin Price
Bitcoin’s value fell to a low of $75,000 over the weekend but has seen a slight recovery, with prices now hovering around $77,800 as the new week begins.
As the market continues to evolve, it will be crucial to monitor the trajectory of Bitcoin ETF netflows and the sentiments of investors moving forward. With many already facing losses, the trading environment will likely remain tense as participants reassess their positions in light of the current market dynamics.
