Bitcoin Sinks Again Despite $1 Billion ETF Inflows

Bitcoin briefly approached 84,800 dollars on Wednesday before erasing almost all of its gains. BTC was trading around 82,800 dollars on Thursday, just above the closely watched 82,500 dollar support. The reversal is not only due to concerns about artificial intelligence. The war with Iran keeps oil at high levels, while US inflation remains at 3.7% and the Fed meets on October 28. Meanwhile, Bitcoin ETFs have nevertheless attracted more than one billion dollars in three sessions.

Bitcoin Fails Again Below $85,000

Wednesday’s move had started well. Bitcoin surpassed $84,000, then approached $85,000. This area has blocked the market for several sessions. A few hours later, bitcoin returned to around $82,800. The situation is reminiscent of what was seen earlier in October when oil and tensions with Iran had already pushed Bitcoin below $83,000. Once again, $82,500 comes back as an important level.

CoinDesk reports that several analysts are watching this threshold as the main short-term support. A sustained break would further weaken the current structure. Conversely, a return above $84,000 then $85,000 would give buyers a bit more room.

For now, neither side has really taken control. Bitcoin remains stuck in a relatively narrow band after falling below $81,000 over the weekend. The rebound thus recovered some of the lost ground, but not enough to erase the fragility accumulated since the beginning of the month.

Other risky assets tell a similar story. Asian stocks fell sharply on Thursday. The MSCI Asia-Pacific ex-Japan lost about 1.8%, while several Asian tech indices dropped between 2% and more than 4%. Bitcoin is therefore not moving alone.

AI Spending Continues to Strain Wall Street

Meta and Tesla were highly anticipated Wednesday evening. Both companies reported different results, but they did not fully reassure investors on a question that has become central: how much more will need to be spent to build the necessary infrastructure for artificial intelligence?

Meta recorded revenue of $64.6 billion in the third quarter, up 26% year over year. Growth remains strong. So does spending. The group now expects $135 to $145 billion in capital expenditures in 2026. Data centers, chips, servers, and infrastructure for Muse and other AI products consume an increasing share of the group’s resources.

Meta’s free cash flow even turned negative in the third quarter, at about -$2.12 billion. Markets are thus trying to gauge when these investments will begin to generate sufficient revenue. This nervousness extends beyond Meta. For several weeks, chip manufacturers, cloud companies, and data center-related firms have experienced particularly volatile sessions.

The issue directly affects Bitcoin because BTC still behaves largely like a risky asset when the Nasdaq falls. Yet Arthur Hayes considers that a possible bursting of the AI bubble could then benefit Bitcoin, especially if authorities respond with more liquidity.

Not yet. In the short term, AI-related concerns rather reduce risk-taking. Tesla sent a different signal by limiting its spending. Its investments in the third quarter reached about $4.7 billion, far from the expected $7.5 billion. The automaker also lowered its annual target to about $20 billion, down from over $25 billion previously. That was not enough to dispel the nervousness.

Iran and Oil Remain a Direct Problem for Bitcoin

This is the other half of the story. Tensions in the Middle East have become significant enough again to keep Brent around or above $110 per barrel this week.

The Strait of Hormuz remains closely monitored. It is one of the most important passages in the world for oil and gas. On Thursday, tensions further escalated in the Gulf. Iranian Revolutionary Guards reported several incidents involving vessels and warned that any new US escalation could lead to a broader response.

Meanwhile, attacks in the region revived concerns about energy supply. The mechanism for Bitcoin is quite simple. Expensive oil feeds inflation expectations. Higher inflation can push the Fed to keep rates higher for longer or consider further tightening. Bond yields then remain attractive and riskier assets lose some of their appeal.

This chain of events has been seen several times since September. As recently as Tuesday, markets reacted almost immediately to conflicting information regarding a possible diplomatic breakthrough with Iran. WTI fell from over $101 to about $95.50 after initial reports of a compromise proposal. The Nasdaq moved from a nearly 1% decline to a 0.6% rise. Bitcoin recovered to $83,000.

Then a denial came. Oil rose back toward $97.60 and Bitcoin lost part of the move, around $82,300. Just a few dollars’ variation in oil was enough to move both stocks and Bitcoin simultaneously.

The Fed Inherits Inflation That Is Still Too High

The energy situation arrives at a bad time for the US central bank. September’s CPI inflation rose 0.6% month over month and 3.7% year over year, according to the Bureau of Labor Statistics. Energy explains a good part of this move. Gasoline prices jumped 9.1% in September, while the overall energy index rose 5.2%. Over twelve months, energy increased by 20.4%.

Bitcoin had already fallen after these figures were published. The problem now is that oil remains high several days after the report. The hoped-for easing of energy pressures is thus not really happening.

The Fed must make its next monetary policy decision on October 28. This meeting becomes more complicated as oil and inflation rise. Markets do not necessarily expect an immediate rate hike. But the debate is more about how long the Fed will need to maintain a restrictive policy.

The Federal Reserve’s schedule confirms a monetary policy meeting on October 27 and 28, with the decision expected on Wednesday. For Bitcoin, the rate itself will not be the only important element.

Comments on inflation, oil, and December’s future decisions can cause as much movement as the official announcement. BTC has already shown this year that a change in rate expectations can quickly move several thousand dollars. The Fed thus arrives in a market already very tense.

ETFs Bring $1.08 Billion Without Unlocking Bitcoin

One factor stands out in this very cautious context: institutional investors are buying again through ETFs. US spot Bitcoin funds attracted about $1.08 billion in three sessions. Monday marked the largest move. ETFs recorded $526.6 million in net inflows. BlackRock’s IBIT alone attracted $665.2 million, offsetting outflows observed at Fidelity and Grayscale.

Capital inflows are important after two difficult weeks. Bitcoin ETFs were still coming out of several sessions marked by withdrawals and insufficient demand.

The situation thus changed quickly. But $1.08 billion is not yet enough to send Bitcoin sustainably above $85,000. This gap deserves attention. In the fastest rising phases, ETF inflows are usually accompanied by strong spot demand, liquidations of sellers, and a favorable macroeconomic environment.

Today, ETFs do part of the work. The rest is still missing. The Nasdaq remains fragile, oil surpasses $100, the war with Iran continues to fuel the geopolitical premium, and the Fed arrives in less than a week with inflation at 3.7%.

That’s why the return of institutional capital has not yet produced the same effect as in September. Bitcoin still has an advantage: buyers have not disappeared. The market still defends the $82,000 to $82,500 area despite several external shocks. ETF inflows also show that some investors use pullbacks to regain exposure.