Bitcoin has surged back above the $70,000 mark, momentarily easing selling pressure after weeks of volatile trading. This recovery follows market reactions to global uncertainty.
Despite the price momentum, a substantial portion of market participants remain under pressure. Data from CryptoQuant indicates that holders of spot Bitcoin ETFs, crucial for institutional and retail demand, are currently below their estimated average realized price of around $79,000. This leaves the average ETF investor at a loss, even with the latest rebound.
During the recent correction, spot Bitcoin ETFs experienced their largest drawdown in invested value. Over $8.9 billion flowed out of the ETF ecosystem as investors reduced exposure. The iShares Bitcoin Trust (IBIT) from BlackRock, a major product, saw significant withdrawals.
More than 42,000 BTC exited this fund, signaling a wave of distribution as market sentiment soured. These outflows contributed to selling pressure in the broader market. While ETFs needed to redeem Bitcoin for redemptions, increasing market supply, the net drawdown from ETF holdings has narrowed from approximately -$8.9 billion to about -$7.8 billion from its peak.