Analysis: Bitcoin ETF investors withdraw $729 million near estimated breakeven

US spot Bitcoin ETF investors withdrew $729 million over two sessions this week as Bitcoin returned to the funds' estimated average entry price. The timing suggests holders are using breakeven prices to exit their positions. Bloomberg Intelligence ETF analyst James Seyffart estimates that the average US spot Bitcoin ETF holder paid $81,722 per coin. Seyffart publicly highlighted Bitcoin's move above that level in late September.

Two weeks later, that price cushion has largely disappeared. BeInCrypto's Bitcoin market data shows Bitcoin trading at $81,607, down 2.2% over 24 hours. The average ETF position is marginally below breakeven at that price. Farside data shows US spot Bitcoin ETFs lost $484.9 million on October 7. That outflow reversed a $118.8 million inflow in the previous session. Another $244.1 million left on October 8. The two sessions erased October's early gains and left month-to-date net flows at minus $407.4 million.

Investors who endured months of losses often sell once their positions return to breakeven. That behavior can make the average purchase price a resistance level. Farside figures for October 1 to October 8 show withdrawals concentrated among a handful of issuers. Fidelity's Wise Origin Bitcoin Fund (FBTC) lost more than the market's entire net outflow. FBTC recorded outflows in five of October's six trading sessions.

However, BlackRock's iShares Bitcoin Trust (IBIT) attracted $332.5 million over the period. The remaining ETFs lost a combined $739.9 million when IBIT is excluded. IBIT nevertheless lost $207.7 million on October 7, the fund's largest withdrawal of the month. The divergence suggests selling by specific investor groups rather than a uniform retreat from Bitcoin exposure.

Farside data shows US spot Ethereum ETFs recorded eight consecutive sessions of outflows, losing $641.3 million since September 29. Spot ETFs were major buyers during September's rally, absorbing more than $2.3 billion between September 21 and September 30 alone. That demand now appears tied to a price level rather than long-term conviction. Whether the funds can attract new buyers once breakeven no longer offers an easy exit remains an open question.