Nikolas Sargeant
US spot Bitcoin exchange-traded funds recorded $257.7 million in inflows Tuesday, marking the largest daily total since early February as Bitcoin recovered modestly to $65,000, breaking a streak of daily redemptions.
The inflows more than offset Monday's $203.8 million in outflows, pushing weekly flows back into positive territory following five consecutive weeks of net redemptions totaling $3.8 billion. Despite the rebound, broader market sentiment remained subdued, with analysts estimating approximately half of Bitcoin's circulating supply trading below acquisition cost.
Since the beginning of 2026, total assets under management in US spot Bitcoin ETFs have declined 30.5%, dropping from approximately $117 billion to $81.3 billion. The substantial drawdown reflects sustained selling pressure and price depreciation that has persisted through the first quarter.
Fidelity Investments' Wise Origin Bitcoin Fund led Tuesday's gains with nearly $83 million in inflows, while BlackRock's iShares Bitcoin Trust recorded $79 million. Cumulative net flows remained above $54 billion after peaking above $62 billion in October 2025, indicating many investors maintained positions despite market weakness.
Institutional investors led by advisers and hedge funds sold a total of 25,000 Bitcoin during the fourth quarter of 2025, representing approximately $1.6 billion at current prices. The selling constitutes a small fraction of Bitcoin's $1.3 trillion market capitalization, with institutions still holding approximately 311,700 BTC.
Multiple analysts noted nearly 9 million BTC, representing 45% of coins in circulation, are currently underwater, worth less than holders paid for them. The metric reflects the severity of the drawdown from Bitcoin's peak prices during 2025.
Industry observers characterized the underwater positions as reflecting Bitcoin's evolution from speculation toward maturity, suggesting the transition necessarily involves periods where significant percentages of supply trade below cost basis as the asset class develops institutional adoption and regulatory clarity.
