Bitcoin and Ether ETFs face a wave of withdrawals

Bitcoin and Ethereum ETFs suffered massive withdrawals on Wednesday, October 29, totaling more than 550 million dollars in a single day. Fidelity, BlackRock, and ARK Invest are among the victims of this wave of redemptions that reflects a sharp change in sentiment. But is this a simple correction or the prelude to a deeper movement?

Investors massively turn away from Bitcoin and Ether ETFs

Exchange-traded funds linked to crypto assets suffered a major setback. Indeed, on October 29, Bitcoin ETFs and Ether faced massive withdrawals, illustrating a renewed caution among institutional investors. 

Fidelity led the way with 164 million dollars withdrawn from its FBTC fund, followed by ARK 21Shares (143 million) and BlackRock (88 million). On the Ether segment, Fidelity’s FETH lost 69.5 million in just a few hours.

This coordinated movement reflects growing nervousness in an unstable macroeconomic context. The Fed rate cut, although anticipated and generally favorable to risky assets, did not have the expected effect. Bitcoin even dropped 2.4% after statements by Jerome Powell, who acknowledged internal divisions on the possibility of a new cut in December.

Ryan Lee, chief analyst at Bitget, analyzes this market’s sharp reaction:

We consider the strong wave of cryptocurrency sales following Fed Chairman Jerome Powell’s dovish tone as a classic case of disappointed expectations in a market hypersensitive to liquidity signals.

Large investors preferred to lock in gains and rebalance their portfolios. Between increased bitcoin volatility, rising bond yields, and geopolitical tensions, the climate has become conducive to caution. 

Diverging views within the Fed suggest more challenging monetary policy decisions to anticipate. This growing uncertainty translates into a loss of investor confidence and directly weighs on the appetite for crypto ETFs.

The scale of the movement is impressive. October had started on an optimistic note, marked by steady capital inflows. But the month-end abruptly reversed the trend.

Analysts point not only to macroeconomic factors but also to a typically institutional behavior: unlike retail investors who remain relatively stable, large portfolios quickly adjust their positions in response to contradictory signals.

Between immediate turbulence and long-term conviction

The divergence between Bitcoin and Ether perfectly illustrates the sector’s challenges. The former is increasingly establishing itself as a strategic reserve asset recognized by institutions, while the latter remains hindered by persistent regulatory uncertainty. 

The 81.4 million dollars withdrawn from Ether ETFs reflect still tentative institutional adoption, in contrast to the solidity of the Bitcoin market.

However, long-term fundamentals remain solid. Matt Mena, analyst at 21Shares, reminds that November is historically favorable for bitcoin, with positive performance in eight of the last twelve years and an average of +46%. 

Despite recent volatility, the 50 billion dollars of assets under management in Bitcoin ETFs demonstrate a deep conviction among professional investors.

Major banks, on their side, anticipate at least two new rate cuts in 2025, a scenario that could breathe new life into digital assets and revive flows toward crypto products.

Are we witnessing a simple tactical retreat or the start of a deeper correction? While 56% of market participants still expect a rate cut in December, internal divisions within the Fed and US-China trade tensions maintain an uncertain climate. For crypto ETFs, November will serve as a decisive test: one of resilience amid macroeconomic nervousness.