U.S. spot Bitcoin ETFs posted $225.2 million in net outflows on July 23, snapping a seven-session streak that had pulled in nearly $1 billion and reminding anyone who had forgotten that the category still trades like a risk asset. The reversal coincided with a broad market selloff driven by the ongoing U.S.-Iran military exchange, which kept oil prices elevated and pushed Bitcoin briefly below the psychologically important $65,000 level to $64,600, a print that put the shorter-term moving average beneath the longer-term one, the chart pattern traders call a death cross.
BlackRock carries the can
BlackRock’s IBIT accounted for $202.5 million of the day’s redemptions, effectively the entire move. Fidelity’s FBTC, Bitwise’s BITB, ARK 21Shares’ ARKB, Franklin Templeton’s EZBC and WisdomTree’s BTCW each posted smaller outflows. Morgan Stanley’s MSBT was the sole fund to see creations, adding $5 million. The net result still leaves the complex roughly $274 million higher for the five sessions through Thursday, but the concentration of the exit in the largest fund underscores how much of the recent inflow narrative has been a single-name story.
Ethereum funds ignore the memo
Spot Ethereum ETFs moved the other way, adding $26.3 million to extend their own inflow streak to five days. The divergence suggests rotation within crypto rather than a wholesale exit from the asset class, though the Crypto Fear and Greed Index dropped three points to 28, its most fear-driven reading of the month, indicating that sentiment remains fragile even as Ether funds attract fresh capital.
The longer view is uglier
The seven-day rally that just ended followed eight brutal weeks that drained more than $8.2 billion from the same Bitcoin funds, a run CoinShares’ James Butterfill described as the largest outflow streak on record. Bloomberg Intelligence’s Eric Balchunas has been framing the cycle through gold ETFs’ 22-year history, predicting a “two steps forward, one step back” rhythm for Bitcoin products. Thursday’s print looks like the step back arriving on schedule.
The Fed gets the last word
The near-term macro test arrives with the Federal Reserve’s July 28-29 meeting. What the central bank decides on rates will likely dictate whether the Bitcoin ETF complex resumes its climb or settles into another extended bleed. For now, the funds have shown they can take the escalator up and the elevator down, sometimes in the same week.