U.S. listed bitcoin, ether ETFs bleed nearly $1 billion in a day

• U.S.-listed spot bitcoin and ether ETFs saw nearly $1 billion in outflows in a single session, as crypto prices tumbled and risk appetite faded.
• Bitcoin dropped below $85,000 and briefly neared $81,000, while ether fell more than 7%, prompting heavy redemptions from major ETFs run by BlackRock, Fidelity and Grayscale.
• Analysts say the synchronized ETF selling reflects institutions cutting overall crypto exposure amid rising volatility, hawkish Federal Reserve expectations and forced unwinding of leveraged positions, though some see the move as a leverage shakeout rather than the start of a bear market.

U.S.-listed spot bitcoin and ether exchange-traded funds (ETFs) suffered heavy redemptions on Thursday, with nearly $1 billion yanked in single session as crypto prices slid sharply and risk appetite evaporated.

According to SoSoValue data, investors withdrew $817.9 million from U.S. spot bitcoin ETFs on Jan. 29, the largest daily outflow since Nov. 20. Ether ETFs also saw sustained selling, losing $155.6 million on the day.

The outflows coincided with a sharp drop in crypto prices. Bitcoin fell through $85,000 and later slid toward $81,000 in U.S. trading hours, before nearing the $83,000 mark in Asian morning hours Friday. Ether dropped more than 7% on the day.

BlackRock’s IBIT bore the brunt of bitcoin ETF redemptions, shedding $317.8 million. Fidelity’s FBTC lost $168 million, while Grayscale’s GBTC saw $119.4 million exit. Smaller products were not spared, with Bitwise, Ark 21Shares and VanEck all posting meaningful outflows.

Ether ETFs followed a similar pattern. BlackRock’s ETHA lost $54.9 million, Fidelity’s FETH saw $59.2 million exit and Grayscale’s ETH products continued to bleed assets. Total ether ETF assets fell to $16.75 billion, down from more than $18 billion earlier this month.

The synchronized selling across bitcoin and ether ETFs suggests institutional investors were reducing overall crypto exposure rather than rotating between assets. That marks a shift from earlier in January, when inflows into ether funds often offset weakness in bitcoin products.

The selloff came amid rising volatility across risk assets and renewed uncertainty around U.S. economic policy, with analysts deeming Fed contender Kevin Warsh as bearish for bitcoin.

Rising implied volatility, weakness in equities, and speculation around future Federal Reserve leadership weighed on sentiment.

At the same time, leveraged positioning in crypto markets was unwound aggressively, adding pressure to spot prices.

For now, ETF flows appear to be tracking price action rather than leading it. As long as bitcoin and ether remain under pressure, analysts expect ETF demand to stay fragile, with investors waiting for volatility to cool before stepping back in.

"Bitcoin crashed to $81k due to a risk-off wave: hawkish Fed holding rates with no cuts soon, heavy spot BTC ETF outflows ($1B+ recently), geopolitical tensions (US-Europe trade spats, Middle East), and a brief gold/silver dip," Andri Fauzan Adziima, Research Lead at Bitrue, said in a Telegram message.

"This triggered massive leveraged liquidations after breaking key support (~$85k 100-week SMA), creating a self-reinforcing sell-off in thin liquidity. It's a leverage shakeout amid macro pressure, not the start of a bear market, with rebound potential if supports hold," Adziima added.