BTC Price Tumbles as ETF Outflows Hit Year's Worst Level, Signaling Market Stress

Bitcoin investors witnessed their heaviest fund exodus in nearly twelve months during the past trading week. US spot Bitcoin ETFs experienced a staggering $1.33 billion in net outflows over just four trading days, marking the most severe weekly withdrawal since February 2025. The timing is particularly striking given that Bitcoin had briefly recovered to above $90,000 earlier, only to face renewed selling pressure that pushed BTC price to fresh lows.

The pullback reflects growing anxiety among market participants as multiple headwinds converged. From geopolitical tariff threats to monetary policy complications abroad, investors rapidly rotated out of risk assets. By late January, Bitcoin had dropped to $87,215, and as of early February 2026, BTC price continues declining further to $76.79K, indicating the downtrend remains intact rather than stabilizing.

BlackRock’s IBIT Fund at Center of Redemption Storm

BlackRock’s iShares Bitcoin Trust (IBIT) faced relentless selling pressure, posting outflows on all four available trading days. The fund’s heaviest redemptions occurred mid-week, with Tuesday seeing $483 million exit and Wednesday experiencing the worst single day at $709 million. Even as demand eased toward week’s end—Thursday saw $32 million and Friday $104 million—the cumulative damage was substantial.

Despite the recent volatility, IBIT maintains approximately $69.75 billion in assets under management, equivalent to roughly 3.9% of Bitcoin’s total circulating supply. This positions the fund as a critical barometer for institutional sentiment. Fidelity’s competing Bitcoin offering shed $451.5 million during the same period. Across the 11 spot Bitcoin ETF issuers tracked, eight reported outflows while only three achieved neutral positioning.

The broader context matters: since January 2024, these vehicles have accumulated $56.5 billion in cumulative inflows, bringing total assets to approximately $115.9 billion. Yet this week’s exodus demonstrates how quickly sentiment can reverse when market conditions deteriorate.

Ethereum ETFs Mirror Bitcoin’s Weakness

Ethereum-focused products faced parallel pressure, recording $611 million in weekly outflows—a sharp reversal from the prior week’s $479 million inflow streak. The Ether ETF complex experienced its worst day on Wednesday with $298 million redeemed, followed by Tuesday’s $230 million withdrawal. Current Ethereum ETF assets total around $17.7 billion, with cumulative inflows since their July 2024 launch reaching $12.3 billion.

What Triggered the Sudden Selling?

The market stress originated from multiple sources simultaneously hitting sentiment. President Trump’s threat of a 10% tariff on eight NATO-allied European nations spooked risk-seeking investors. While these tariff threats were subsequently withdrawn following Greenland discussions, BTC price had already suffered significant damage, dropping below $90,000 and failing to recover convincingly.

Senate delays on the Market Structure Bill vote intensified uncertainty around US crypto regulation—a critical concern for institutional players. However, perhaps the most persistent pressure came from abroad: rising 10-year Japanese Government Bond yields climbed sharply following Prime Minister Sanae Takaichi’s fiscal spending announcements. The Bank of Japan’s hawkish monetary policy signals on January 23 further elevated JGB yields, which theoretically reduces liquidity in risk markets and weighs disproportionately on speculative assets like Bitcoin.

Sentiment Hits Extreme Fear Territory

The psychological impact proved as damaging as the fundamentals. The Fear & Greed Index collapsed from 49 on January 18 to just 25 by January 25—diving squarely into “Extreme Fear” territory and suggesting severely oversold conditions. This psychological despair often precedes market capitulation.

According to Farside Investors data, Bitcoin ETF year-to-date outflows reached $117.1 million through January 23, though this figure predates the most severe selling days of the subsequent week.

The Bigger Picture

The current BTC price weakness and simultaneous ETF outflows highlight a critical reality: institutional adoption via ETFs doesn’t automatically guarantee consistent inflows. When macro conditions sour—especially from unexpected sources like Japanese policy shifts—the same ETF vehicles that attracted $56.5 billion cumulatively can reverse those flows with stunning speed.

For now, Bitcoin ETF managers and investors alike are watching whether the latest selling represents capitulation or merely the early stage of a more prolonged pullback. BTC price stability around current levels will likely determine whether this week’s outflows mark a temporary panic or the beginning of a more sustained institutional retreat from crypto positions.