CHONGQING, CHINA - JULY 17: In this photo illustration, a person holds a physical representation of a Bitcoin (BTC) coin in front of a screen displaying a candlestick chart of Bitcoin's latest price movements on July 17, 2025, in Chongqing, China. (Photo illustration by Cheng Xin/Getty Images)
The iShares Bitcoin Trust ETF has recorded $2.2 billion in outflows this month, according to FactSet data, as of Monday. This figure is almost eight times the $291 million losses it suffered last October, marking this as the fundâs second-worst month since its launch in early 2024.
BlackRock's spot bitcoin exchange-traded fund is experiencing its most challenging month yet, as the underlying asset faces its most significant monthly decline in over three years.
The outflows coincide with Bitcoin's plummeting value. The cryptocurrency recently traded at $87,907.10, representing a drop of over 20% in just the past month and more than 40% down from its early October peak of over $126,000. This positions November as Bitcoinâs worst month since its 39% fall in June 2022.
"There's no doubt that hot-money investments have had significant outflows," explained Jay Hatfield, CEO and portfolio manager at Infrastructure Capital Advisors, to CNBC. However, he noted, "the pullback is really focused on the gambling part of the market ⌠and Bitcoin is really the poster child for that."
Investors are withdrawing from BlackRock's fund to move towards risk-off assets like gold, amid growing economic uncertainties and an increasingly pessimistic market sentiment.
A University of Michigan survey recently highlighted a sharp decline in consumer sentiment. Investors are also eagerly waiting for critical data from the September retail sales and producer price index reports, scheduled for release on Tuesday. Although the CME FedWatch Tool suggests traders now see more than an 80% probability that the Federal Reserve will cut rates at its December meeting, a reduction remains unsure.
Amid this uncertainty, Bitcoin is suffering significant losses. Investors in spot Bitcoin ETFs, particularly those who have recently entered the market, are facing pressure to sell their sharesâan action that could further exacerbate the asset's decline in the near term, according to Frank Chaparro, head of content and special projects at the crypto-focused trading firm GSR, who spoke to CNBC.
"With the macro environment becoming less certain, investors tend to de-risk across assets, which often means trimming exposure to crypto and other risk-sensitive stocks," Chaparro explained. "And for newer entrants who came in through the funds, any downturn can be unsettling â they can sell just as quickly as they bought."
While it's true that spot Bitcoin ETFs have ushered in waves of new retail investors who may be cautious during volatile periods, the funds have also attracted long-term institutional investors who are better able to weather downturns, according to Joshua Levine, chairman at bitcoin treasury firm OranjeBTC, who also spoke to CNBC.
This institutional base could "dampen some of the extreme downside while also smoothing upside, reducing Bitcoin's volatility as the asset class matures," Levine added.