Bitcoin exchange-traded funds (ETFs) have seen a steady decline in capital, with nearly $800 million in outflows recorded this week, marking the fourth consecutive week of net outflows. This brings the total capital withdrawn from Bitcoin ETFs over the past month to over $4.5 billion. Despite expectations surrounding the White House Crypto Summit, institutional investors appear cautious, and market sentiment remains unsettled due to macroeconomic factors.

Uncertainty and Market Instability Drive Outflows

Data from SoSoValue reveals that U.S.-based Bitcoin ETFs experienced significant outflows, with the largest being $409 million on Friday alone. Leading funds, such as Ark Invest’s ARKB and Fidelity’s FBTC ETFs, saw outflows of $160 million and $154.9 million, respectively. Other major ETF issuers, including BlackRock’s IBIT and Grayscale’s GBTC, followed suit with smaller outflows. In addition to Bitcoin ETFs, Ethereum ETFs also reported consecutive weeks of negative flows, further reflecting the broader bearish sentiment in the market.

Macroeconomic Concerns Impacting Investor Sentiment

Despite the hype surrounding the White House Crypto Summit, which initially had the potential to spur positive market momentum, Bitcoin ETFs continued their downward trend. Analysts point to several macroeconomic factors that may be contributing to the ongoing sell-off. Specifically, persistent concerns over President Trump’s trade tariffs and broader economic instability are eroding investor confidence in digital assets.

Experts suggest that structural shifts in the market may also be influencing these outflows. One theory revolves around the unwinding of low-risk arbitrage trades between Bitcoin spot ETFs and CME futures, which hedge funds have been exploiting. As these trades collapse, liquidity is withdrawn, leading to sell-offs and further outflows from crypto investment products.

The “Sell the News” Phenomenon Post-Crypto Summit

Another contributing factor to Bitcoin’s recent volatility is the declaration of President Trump’s Strategic Bitcoin Reserve and the U.S. Digital Asset Stockpile. While many market participants expected the Crypto Summit to provide a bullish catalyst, the unexpected signing of an executive order establishing the reserve triggered a sharp price decline from $90,000 to $85,000. This event, described as a “sell the news” reaction, caught traders off guard, leading to panic selling.

According to QCP Capital, the initial market optimism surrounding the summit quickly evaporated after traders realized no immediate funding would be allocated for Bitcoin purchases. The failure to match bullish expectations with concrete plans led to an abrupt price pullback and increased outflows from Bitcoin ETFs, particularly on Friday when the largest withdrawals were recorded.

Outlook and Institutional Investor Behavior

While the current decline in Bitcoin ETF inflows signals a period of cautiousness among institutional investors, the outflows are largely driven by macroeconomic fears and strategic market positioning. These concerns, combined with uncertainty over future Bitcoin purchases, suggest that institutional capital is opting for a more risk-averse approach in the short term.

As institutional investors withdraw capital, it remains to be seen whether Bitcoin ETFs can recover from these outflows. Analysts continue to monitor economic indicators, particularly related to government policies and international trade, to gauge how these factors will affect cryptocurrency markets moving forward. For now, the Bitcoin ETF market remains in a period of consolidation, with macroeconomic concerns weighing heavily on investor sentiment.