Recent turmoil in the digital asset market has prompted a significant shift in investor behavior, as U.S. Bitcoin exchange-traded funds (ETFs) report their first recorded decline. On June 5, 2025, Bitcoin ETFs faced outflows of $278 million, leading to total withdrawals of $1.21 billion across three trading sessions—the most significant drawdown in almost three months. This downturn marks the first quarterly decline for institutional Bitcoin ETF holdings since their inception in the U.S., dropping from $27.4 billion at the end of 2024 to $21.2 billion in the first quarter of 2025, according to CoinShares data.
The decline aligns with a broader market trend where Bitcoin's price fell by 11% during this period. In contrast, Ethereum ETFs have managed to attract inflows, contradicting Bitcoin's struggles. Despite the recent setbacks, notable players in the financial sector, such as JPMorgan Chase, are adapting by allowing their high-net-worth clients to use crypto ETFs as collateral, indicating ongoing institutional interest in Bitcoin as a long-term asset.
"We're seeing a mixed narrative where some institutional investors are reducing their Bitcoin exposure, while others are finding ways to incorporate these assets into their portfolios," said a market analyst. BlackRock’s iShares Bitcoin Trust recently noted the largest single-day outflow since its launch, with $430 million leaving in one day, breaking a long inflow streak.
The decline aligns with a broader market trend where Bitcoin's price fell by 11% during this period. In contrast, Ethereum ETFs have managed to attract inflows, contradicting Bitcoin's struggles. Despite the recent setbacks, notable players in the financial sector, such as JPMorgan Chase, are adapting by allowing their high-net-worth clients to use crypto ETFs as collateral, indicating ongoing institutional interest in Bitcoin as a long-term asset.
"We're seeing a mixed narrative where some institutional investors are reducing their Bitcoin exposure, while others are finding ways to incorporate these assets into their portfolios," said a market analyst. BlackRock’s iShares Bitcoin Trust recently noted the largest single-day outflow since its launch, with $430 million leaving in one day, breaking a long inflow streak.
