BlackRock Bitcoin Fund Suffers Record $333 Million as Price Declines

Bitcoin's incredible rally in 2024 paused as institutional investors reduced their positions. BlackRock's iShares Bitcoin Trust ETF (IBIT), a spot Bitcoin fund, reported its biggest single-day outflow since its launch, with $333 million withdrawn yesterday (Thursday), according to Bloomberg data.

Third Consecutive Day of Outflows

The withdrawal marked the third straight day of outflows for the fund, highlighting a shift in sentiment. IBIT, which launched in January, had become popular among institutional investors, a factor that pushed Bitcoin to a record high of $108,315 in mid-December.

However, by year-end, the once unstoppable fund began to lose momentum. The decline in IBIT's inflows reflects a broader trend across the cryptocurrency sector.

[BREAKING] #BlackRock’s iShares Bitcoin Trust (IBIT) saw a record outflow 🔴$332.6M (-3,413 BTC) on the first trading day of 2025!This surpassed the ETF’s previous low of $188.7M (-1,933 BTC) on December 24, 2024.In 2024, BlackRock saw cumulative inflows of $37.2B for its… pic.twitter.com/CGQhI3niKb

Since December 19, Bitcoin-focused exchange-traded funds in the U.S. have reportedly recorded net outflows of approximately $2 billion. Additionally, open interest in Bitcoin futures on the Chicago-based CME Group fell nearly 20% from its December peak.

This decline in outstanding contracts, often used to gauge institutional demand, represents a shift in market dynamics as investors reassess their risk exposure.

Year-End Portfolio Adjustments

Market analysts attribute the outflows to year-end portfolio adjustments by institutional investors. These adjustments come as Bitcoin trades nearly 11% below its December high, at $96,423 today (Friday).

While significant, the pullback is not unusual following a year of explosive gains for the cryptocurrency. Despite the record outflows, BlackRock has reportedly not issued a statement regarding the trend. Bitcoin's retreat, coupled with reduced institutional activity, suggests the digital asset's exponential rise in 2024 may face a more measured pace in the months ahead.

BlackRock's #Bitcoin ETF, $IBIT, is now worth nearly double BlackRock's gold ETF, $IAU. which was launched in 2005 👀 pic.twitter.com/jAiCKmPsN7

IBIT was launched early last year following the approval of spot Bitcoin ETFs in the US. The fund took the lead at its commencement, at pre-market trading. Securities and Exchange Commission's (SEC) approval of the applications from major companies such as BlackRock, Grayscale, and others paved the way for 11 spot Bitcoin ETFs to be listed and traded on public exchanges.

Last month, US-based spot Bitcoin ETFs collectively recorded outflows totaling $338.4 million. Since December 19, these funds have reportedly experienced net outflows of $1.52 billion. Interestingly, US Bitcoin ETFs surpassed gold ETFs in assets under management for the first time, reaching $129 billion.