Bitcoin ETF Outflows Reach $679 Million as Downside Risk Rises

Bitcoin remains vulnerable until long-term Treasury yields stabilize and spot ETF flows turn net positive, as weekly withdrawals from U.S. crypto ETFs add pressure to the market.

U.S. spot Bitcoin ETFs recorded about $679 million in net outflows last week, the largest weekly withdrawal since late June. Ether ETFs posted roughly $542 million in net outflows.

Bitcoin dropped from about $86,000-$87,000 to roughly $80,400 on Thursday before recovering above $83,000 and moving back above $82,500. Bitcoin has lost the inflow support behind its six-week rally, leaving it more sensitive to volatility in U.S. stocks.

The S&P 500 rose 1.2% last week to a record high, supported by expectations for earnings growth. Crypto markets lack comparable earnings support and depend more heavily on new capital inflows as U.S. stocks were supported by expectations for earnings growth.

Federal Reserve meeting minutes indicated that most officials expected another rate increase this year. Markets priced about a 20% probability of a rate hike at the end of October, while the 10-year Treasury yield rose to 5.24%.

Bitcoin would face added downside risk if the 30-year Treasury yield breaks above 5.64%, the level reached Sept. 30, or if it continues to face resistance near $82,500.

Markets will focus on the release of the September consumer price index on Oct. 14 to assess whether energy inflation is spreading into core inflation. Financial institution earnings and results from artificial intelligence-related companies will also be in focus.