Bitcoin exchange-traded funds (ETFs) proceed to carry billions in belongings regardless of bitcoin’s brutal value crash, however that endurance is not essentially the bullish sign that many have come to imagine.
In keeping with one analyst, the resilience stems from market makers and arbitrageurs who commerce out and in slightly than die-hard long-term holders betting on value appreciation.
Bitcoin’s value peaked above $126,000 in early October and just lately crashed to just about $60,000. Regardless of the value halving, the 11 spot bitcoin ETFs listed within the U.S. have cumulatively registered simply $8.5 billion in web outflows. These funds nonetheless maintain $85 billion in belongings underneath administration, which equates to over 6% of bitcoin’s provide.
A number of analysts, together with these CoinDesk spoke with at Consensus Hong Kong final week, cited the identical information as proof of bullish positioning.
Markus Thielen, founding father of 10x Analysis, says the resilience comes not simply from long-term hodlers, however from market makers and arbitrageurs with hedged, non-directional positions.
“This displays the structural nature of ETF possession, which is dominated by market makers and arbitrage-focused hedge funds holding largely hedged positions, in addition to long-term institutional traders with low turnover and longer funding horizons,” Thielen stated in a notice to shoppers on Wednesday.
Thielen pointed to reviews from establishments (known as 13F filings) for late 2025. They present that 55% to 75% of BlackRock’s IBIT ETF, which holds $61 billion, is owned by market makers and arbitrage-focused hedge funds who maintain their bets hedged or impartial, not actually bullish on bitcoin.
Market makers are entities that create liquidity in an alternate’s order guide, facilitating the seamless execution of enormous purchase and promote orders at steady costs. They revenue from the bid-ask unfold and due to this fact try to keep up market-neutral publicity to bypass value volatility dangers. Equally, arbitrage hedge funds take opposing positions in two markets, corresponding to spot ETFs and futures, to revenue from the value differential between the 2.
Each entities, due to this fact, don’t inject directional pressures (bullish/bearish) into the market.
Thielen added that market makers trimmed publicity by round $1.6 billion to $2.4 billion through the fourth quarter, as bitcoin traded close to $88,000, reflecting “declining speculative demand and lowered arbitrage stock necessities.”
