Bitcoin ETFs Bleed $648M as Analysts Warn of Weak Demand and Macro Pressure

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<a href="https://investment-policy.com/btc-usd/">Bitcoin</a> ETFs lose $648M as analysts warn of weak demand

U.S. Bitcoin exchange-traded funds (ETFs) experienced their largest one-day drop in investor money since late January, with nearly $650 million withdrawn as Bitcoin’s price fell below $78,000. This decline happened alongside growing worries about global political issues and inflation.

Summary

  • U.S. spot Bitcoin ETFs posted $648.6 million in net outflows, the largest single-day withdrawal since Jan. 29.
  • Bitcoin fell below $77,000 as rising U.S.-Iran tensions and higher oil prices renewed inflation concerns across risk markets.
  • Analysts at Bitfinex said weakening ETF demand and slower on-chain capital inflows have left Bitcoin more exposed to macroeconomic pressure.

ETF investors pulled out $648.6 million on Monday, bringing the total withdrawals for the week to around $1 billion. This ends a six-week period of consistent investment into ETFs, according to data from SoSoValue.

The BlackRock IBIT fund saw the biggest drop in investments with $448.3 million leaving, followed by Ark & 21Shares’ ARKB with $109.6 million in outflows. Fidelity’s FBTC also experienced withdrawals totaling $63.4 million, and funds from Bitwise, VanEck, Invesco, and Franklin Templeton all finished the day with net losses.

Bitcoin faced increased selling pressure after falling below $77,000 over the weekend. This drop coincided with rising tensions between the U.S. and Iran, which drove up oil prices and sparked worries that inflation might stay high for an extended period.

As of Tuesday, Bitcoin was hovering around $77,000, the same price it started the month at. Analysts at Bitfinex say this price point is key to seeing if Bitcoin’s recent gains can continue.

Bitfinex warns institutional demand is weakening

According to a new report from Bitfinex, a digital asset exchange, the recent drop in crypto prices reveals a weakening of overall demand. The report suggests that two key factors driving recent purchases – spot Bitcoin ETFs and crypto products offering returns, like STRC – are both losing steam, coinciding with a more challenging economic climate.

As I’ve been tracking the market, liquidity has really weakened – it’s the lowest we’ve seen since early February. This makes Bitcoin more susceptible to things like unexpected news or fluctuations in interest rates. What’s also concerning is that we’re not seeing the same strong buying pressure from institutional investors that we saw earlier in this bull run, which previously helped to drive prices up.

Analysts have also been watching how money is moving on the Bitcoin network itself. They focused on a measure called the Realised Cap 30-Day Net Position Change, which shows how much capital enters Bitcoin each month. After Bitcoin’s price rose towards $82,000 earlier this month, this metric increased to around $2.8 billion per month, suggesting it contributed to the recent price gains.

While Bitcoin is seeing some investment, the current rate of new money coming in is slower than in previous periods of growth. Past rallies between 2023 and 2025 saw monthly inflows reaching around $10 billion – much higher than they are now. Analysts believe this weaker investment trend could make it difficult for Bitcoin to hold its value if interest rates stay high.

Analysts also cautioned that rising inflation is making it more difficult for the Federal Reserve to decide how to move forward with its plans.

According to a recent report, the new Federal Reserve chair is taking over an institution that hasn’t met its inflation goals for five years. Public belief about future inflation is also unstable, and investors still see the chair’s past statements as suggesting a preference for lower interest rates, even though current economic data doesn’t support that view.

Despite growing calls for lower interest rates, recent inflation figures make it difficult to justify any cuts. The latest report suggests that expectations for multiple rate cuts later in 2026 are fading, with many now anticipating the Federal Reserve will maintain its current, stricter policies to regain control of inflation and demonstrate its commitment to price stability.

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2026-05-19 12:09