Despite a sharp pullback in crypto prices, Bitcoin (CRYPTO: BTC) ETF investors have largely held their positions, signaling stronger conviction than many expected.
‘ETF Buyers Are Just HODLing'
In a post on X on Wednesday, Bloomberg ETF analyst Eric Balchunas noted that even after Bitcoin's roughly 40% drawdown, about 94% of assets in spot Bitcoin ETFs remain invested.
The comment followed a discussion suggesting that recent selling pressure has come primarily from long-term OG whales rather than ETF holders, who appear to be “just HODLing.”
Jim Bianco of Bianco Research added context, pointing out that the average Bitcoin ETF investor is now roughly 24% underwater, with unrealized losses approaching $11 billion.
Still, the exchange underscored that current conditions reflect typical market volatility rather than a structural breakdown in ETF demand.
According to SoSoValue data, spot Bitcoin ETFs recorded $544.9 million in net outflows as of Feb. 4, while spot Ethereum (CRYPTO: ETH) ETFs saw $79.5 million in net outflows.
In contrast, spot XRP (CRYPTO: XRP) ETFs posted modest net inflows of $4.8 million.
Price Rebound Without Fresh Inflows Raises Caution
Crypto analyst Ali Martinez noted that Bitcoin has, for the first time in 18 months, fallen below the average spot ETF cost basis near $82,600.
With BTC trading around $77,000, a large portion of ETF holders is now underwater.
Historically, sustained trading below aggregate cost basis has increased selling pressure, a trend Martinez said is already visible. Roughly 17,400 BTC exited ETFs during the week of Jan. 19, followed by another 9,540 BTC the following week.
As a result, Martinez cautioned that recent price rebounds may be corrective rather than the start of a new uptrend unless ETF inflows resume.
If outflows persist, he flagged the 200-week moving average near $57,000 as the next major macro support level.
Overall, ETF flow data suggests elevated downside risk and argues for patience in the near term.
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