Bitcoin ETFs See $434 Million Net Outflow as BTC Falls Beneath $70,000
February 6 2026
Spot Bitcoin exchange‑traded funds (ETFs) recorded a sharp withdrawal of $434 million on Thursday, adding to $545 million that left the products on Wednesday. The two‑day outflow brings total weekly redemptions to roughly $690 million, a notable reversal after Monday’s $561 million influx.
The slump in ETF assets coincided with a rapid decline in the price of Bitcoin (BTC), which briefly slipped to $60,000 – a level not seen since October 2024, according to market data from CoinGecko. The price dip pushed BTC below the psychologically significant $70 k threshold, reviving concerns about the resilience of the newly‑launched spot Bitcoin ETFs.
Market Flow Overview
| Day (UTC) | Net Flow (USD) |
|---|---|
| Monday | +$561 M (inflows) |
| Tuesday | –$545 M (outflows) |
| Wednesday | –$434 M (outflows) |
| Weekly Total | ≈ –$690 M |
SoSoValue, which tracks ETF movements, reports that the aggregate assets under management (AUM) for spot Bitcoin ETFs now sit at about $81 billion, with cumulative net inflows since their debut in January 2024 totaling $54.3 billion.
Altcoin‑focused ETFs displayed a mixed picture. Ether‑linked funds registered $80.8 million of outflows, while XRP and Solana ETFs posted modest net inflows of $4.8 million and $2.8 million, respectively.
Why the Outflows?
1. Price Pressure on BTC
The most immediate catalyst for the redemption surge was Bitcoin’s price slide. The asset’s retreat toward the $60 k region erased a sizeable portion of unrealized gains, prompting investors to pull capital from the ETFs either to lock in profits elsewhere or to avoid further downside.
2. “Paper Bitcoin” Debate
Since the approval of spot Bitcoin ETFs in January 2024, a vocal segment of the community has questioned whether these products dilute Bitcoin’s scarcity. Critics argue that a single BTC can now back multiple financial instruments—ETF shares, futures contracts, perpetual swaps, options, and various structured products—effectively creating “paper Bitcoin.”
Bob Kendall, a technical analyst and author of The Kendall Report, highlighted this concern on X, describing the current environment as a “fractional‑reserve price system.” Such criticism resurfaced amid the recent outflows, as some investors appear to be re‑evaluating the exposure that ETFs provide to the underlying asset.
3. Institutional Sentiment
Analysts who remain optimistic about the ETFs point to their “resilience” and the potential for institutional participation to stabilize the market over the long term. Nevertheless, the data suggests that short‑term sentiment remains fragile, especially when the underlying price action turns negative.
Analyst Perspectives
- Bob Kendall (Technical Analyst) – Emphasizes that multiple derivatives built on the same underlying BTC could undermine the perception of scarcity, potentially leading to price distortions.
- Josef Tětek (Trezor Analyst) – Previously warned that the ETF structure could permit the creation of “millions of unbacked Bitcoin,” a scenario that may suppress spot prices.
- Market Observers – Note that despite the outflows, total ETF AUM remains robust at $81 billion, indicating that the sector still commands significant capital, though it is now more sensitive to price swings.
Key Takeaways
- Heavy Redemptions: Spot Bitcoin ETFs suffered $434 million of net withdrawals on Thursday, contributing to a $690 million weekly outflow.
- Price Correlation: The outflows came as BTC dipped to $60,000, underscoring the tight link between ETF flows and spot price movements.
- “Paper Bitcoin” Concerns: Ongoing debate about the impact of ETFs on Bitcoin’s scarcity is influencing investor sentiment.
- AUM Remains High: Despite short‑term outflows, total assets in spot Bitcoin ETFs are still around $81 billion, reflecting deep institutional interest.
- Altcoin ETFs Diverge: Ether funds saw notable outflows, while XRP and Solana ETFs experienced modest inflows, suggesting differentiated risk appetites across crypto assets.
Outlook
The coming weeks will likely test whether the recent outflows represent a temporary reaction to a price correction or a more structural shift in how investors view Bitcoin exposure via ETFs. Should BTC regain momentum above the $70,000 mark, inflows could resume, restoring some of the weekly net loss. Conversely, persistent price weakness combined with the “paper Bitcoin” narrative may continue to pressure ETF holdings, prompting further redemptions.
Investors and market participants should monitor both spot price dynamics and the evolving discourse around ETF‑derived exposure to gauge future capital flows in this rapidly maturing segment of the crypto ecosystem.
Source: https://cointelegraph.com/news/bitcoin-etf-434-million-outflows-price-touches-60k?utm_source=rss_feed&utm_medium=feed&utm_campaign=rss_partner_inbound
