Bitcoin ETFs Hold Firm Despite 40% BTC Drop
Bitcoin has tumbled more than 40% from its October highs, yet spot Bitcoin ETFs have remained resilient, with only 6.6% of assets withdrawn during the selloff.
Bloomberg Intelligence Senior ETF Analyst Eric Balchunas highlighted why ETF investors are holding steady. Many treat bitcoin as a small 1%–2% allocation alongside stocks and bonds, allowing strong equity markets to cushion losses. “For now, the ETF boomers have really come through,” he said.
By contrast, crypto-native holders and leveraged traders face heavier selling pressure, often experiencing what Balchunas calls “existential crisis mode.” Historically, bitcoin has rebounded from similar drawdowns multiple times.
Balchunas also drew parallels with gold ETFs, which fell roughly 40% over six months a decade ago, losing one-third of assets before rebuilding to $160 billion. Bitcoin ETFs, which once rivaled gold in size, show flows can reverse over time.
While volatility is expected to continue, ETFs may help anchor bitcoin in mainstream portfolios. “A selloff doesn’t mean the end,” Balchunas said. “It just means it’s a selloff.”
