BlackRock: “Claims of massive liquidations from Bitcoin ETFs?…Not true”

As spot Bitcoin exchange-traded funds (ETFs) are being cited as one of the key factors behind Bitcoin (BTC)’s recent weakness, BlackRock, the manager of the largest spot Bitcoin ETF, IBIT, pushed back against that narrative.

According to the industry on the 13th (Korea time), Robert Mitchnick, BlackRock’s head of digital assets, said at an event, “The perception that hedge funds are pulling out large amounts of capital and amplifying market volatility is not accurate,” adding, “Some believe hedge fund money has poured into ETFs, creating volatility and then driving selling, but the data we’re seeing does not support that.”

He added specifically, “Even though the Bitcoin market had a fairly turbulent week last week, only 0.2% of fund assets were redeemed from IBIT,” and explained, “If hedge funds had been running large positions via ETFs and then abruptly liquidated them, there should have been outflows of several billion dollars. But in reality, unlike the billions of dollars liquidated on leveraged platforms, ETF flows were very stable.”

He continued, “The ETF investor base is far more long-term oriented,” adding that “the notion that ETFs are a conduit for short-term speculative money is a misunderstanding.”