BlackRock’s iShares Bitcoin Trust (IBIT) experienced its largest single-day redemption since its launch, with investors withdrawing $523 million on Tuesday.
Since peaking in October, Bitcoin has dropped nearly 30%, reaching levels not seen since April. The decline followed a liquidation event on October 10 that erased approximately $19 billion in leveraged positions, a shock from which the market has struggled to recover.
Bitcoin pulls back from October highs
Tuesday’s retreat pushed investors in the U.S.’s 12 spot Bitcoin ETFs collectively into the red, accelerating withdrawals. In total, more than $3 billion has exited these funds this month, with IBIT alone accounting for nearly $2 billion. BlackRock has not commented on the outflows.
Despite this downturn, IBIT remains a dominant player. Since debuting in January 2024, the fund has amassed over $72 billion in assets and attracted around $26 billion in inflows this year, highlighting its historical appeal to institutional investors.
Market liquidity and investor sentiment
The combined impact of ETF outflows and long-term holder sales has tightened Bitcoin liquidity, putting additional downward pressure on prices. Research strategists note that this trend underscores caution among institutional participants amid macroeconomic uncertainty.
Options markets have reflected this sentiment, with traders increasingly buying protection against Bitcoin falling toward $80,000 by late December. Analysts point to concerns over U.S. economic resilience and the uncertain timing of potential rate adjustments as factors influencing investor behavior.
Broader digital asset outflows
This episode fits a wider pattern in the digital asset space. Last week, investment products saw their heaviest outflows since February, totaling $2 billion and extending a three-week streak of withdrawals. Over the same period, overall assets under management in digital asset ETPs declined from $264 billion in early October to $191 billion.
The United States accounted for the bulk of these redemptions, with $1.97 billion leaving domestic products. Switzerland and Hong Kong reported smaller outflows of $39.9 million and $12.3 million, respectively. Analysts attribute the trend to a combination of macroeconomic uncertainty and profit-taking by large crypto holders.
Harvard triples Bitcoin ETF holdings amid market volatility
While retail and ETF investors have been pulling back, Harvard University has taken a strikingly opposite approach. The Ivy League endowment nearly tripled its stake in BlackRock’s iShares Bitcoin Trust (IBIT) during the third quarter of 2025, raising its holdings to 6.8 million shares worth $443 million, up from $117 million the previous quarter.
The move now makes IBIT Harvard’s largest single public equity position, surpassing stakes in tech giants and even gold.
Harvard’s expansion comes amid turbulent market conditions. Bitcoin has fallen below $95,000, down over 24% from its October peak, and spot Bitcoin ETFs recorded $1.11 billion in outflows last week. Yet, the endowment’s simultaneous increase in gold and tech holdings indicates a multi-pronged approach to diversification and inflation hedging.
Other institutions are following suit. Emory University boosted its Bitcoin ETF exposure, and Abu Dhabi’s Al Warda Investments more than doubled its IBIT stake.
Gunel Ismayilova
Disclaimer: All materials on this site are for informational purposes only. None of the material should be interpreted as investment advice. Please note that despite the nature of much of the material created and hosted on this website, HODL FM is not a financial reference resource, and the opinions of authors and other contributors are their own and should not be taken as financial advice. If you require advice. HODL FM strongly recommends contacting a qualified industry professional.
