Institutional Anxiety and Economic Instability Trigger $660 Million Withdrawal from Crypto ETFs

Bitcoin and

ETFs ended the week in negative territory, with combined withdrawals surpassing $660 million. This points to a change in institutional outlook as the broader crypto market experiences a selloff. U.S. spot ETFs saw a net withdrawal of $253.4 million on September 25. BlackRock’s iShares Bitcoin Trust (IBIT) was the only major fund to attract inflows, bringing in $79.7 million. The largest outflow came from Fidelity’s Wise Origin Bitcoin Fund (FBTC) at $114.8 million, followed by Grayscale’s (down $42.9 million) and Bitwise’s BITB (down $80.5 million). ETFs performed even worse, losing $251.2 million over the same period, marking the fourth straight day of outflows. The biggest contributors were Fidelity’s FETH (down $158.1 million) and Grayscale’s ETHE (down $30.3 million).

The outflows from Bitcoin ETFs coincided with a drop in total assets under management (AUM) for the asset class, which fell to $144.3 billion—representing 6.64% of Bitcoin’s total market value. While historical cumulative inflows reached $57.2 billion, recent withdrawals have shaken investor confidence. Ethereum ETFs also saw their AUM shrink to $25.6 billion, or 5.46% of ETH’s market cap, with total inflows at $13.37 billion. The ongoing withdrawals from both BTC and ETH ETFs reflect broader economic uncertainty, including the Federal Reserve’s recent rate reduction and anticipation of new inflation data.

Bitcoin’s value dropped to a four-week low of $108,700 on September 25, while Ethereum slid to $3,956, extending a week-long slide of 12.5%. According to on-chain analytics provider Glassnode, long-term holders realized profits on more than 3.4 million BTC, causing a sense of “exhaustion” in the market. Experts cautioned that if Bitcoin tests support near $107,500, further declines could be triggered by stop-loss selling. Ethereum’s technical signals also pointed to weakness, with its relative strength index (RSI) falling to 14.5—the lowest since June 2025.

Institutional activity revealed different approaches among leading ETF issuers. BlackRock’s IBIT continued to lead the Bitcoin ETF sector, holding $84.35 billion in AUM and $60.86 billion in cumulative inflows. In contrast, Fidelity and Grayscale experienced notable redemptions, suggesting investors are favoring funds with lower fees. For Ethereum, BlackRock’s ETHA remained unchanged, while Fidelity’s FETH continued to see the largest outflows. The performance gap between Bitcoin and Ethereum ETFs highlights diverging institutional attitudes, with Bitcoin enjoying a net inflow of $241 million on September 24, while Ethereum continued to face withdrawals.

The withdrawals occurred alongside a broader downturn in the crypto market. The global crypto market cap fell by 1.45% in 24 hours, with both Bitcoin and Ethereum losing over 1.5%. Analysts attributed the decline to profit-taking, economic uncertainty, and seasonal trends, as September is typically a weak month for cryptocurrencies. Bitcoin ETF trading volumes reached $5.42 billion on September 25, while Ethereum ETF volumes totaled $972.04 million. The difference in institutional participation—$9.18 billion in Bitcoin ETF volumes versus $4.64 billion for Ethereum—underscored Bitcoin’s ongoing appeal to institutional investors, despite recent outflows.

Looking forward, the market stands at a pivotal point. If inflows into Bitcoin ETFs stabilize or reverse, it could indicate renewed institutional trust and support a price rebound. However, continued outflows may intensify bearish trends, especially if the macroeconomic environment worsens. For Ethereum, the fourth straight day of outflows raises concerns about competition from other networks and regulatory challenges, though a recovery above $3,900 could spark short-term gains. Analysts stressed the need to watch on-chain data, such as transaction activity and hash rates, for signs of a potential turnaround in the coming weeks.