$530 million flowed out of bitcoin and ethereum spot exchange-traded funds (ETFs) in net terms in a single day.
CoinPost, a blockchain media outlet, reported on Nov. 7 that on Nov. 5 $430 million left bitcoin spot ETFs and $99.97 million left ethereum spot ETFs. All dates are in local time.
The shock spread across stock and crypto markets. The Nasdaq Composite fell 5.5 percent the same day, while bitcoin and ethereum dropped 5.6 percent and 7.8 percent, respectively. Investors are seen pulling funds on worries regulation of artificial intelligence (AI) infrastructure investment could tighten after Democrats took control of Congress in the U.S. midterm elections.
None of the 12 bitcoin spot ETF products posted net inflows. Fidelity's FBTC saw net outflows of $200 million, while BlackRock's IBIT recorded net outflows of $105 million. This suggests the withdrawals were not limited to a few products but spread across the market.
Bitcoin also swung sharply. It slid to $75,642 on the night of Nov. 5 and is still trading above $74,900, giving up gains made after the U.S. midterm elections. Over the 24-hour period, forced liquidations exceeded $1 billion. With ETF outflows and a sharp price drop occurring at the same time, a move toward avoiding risk assets was confirmed.
Outflows are also continuing from ethereum spot ETFs. BlackRock's ETHA saw $75.2 million leave, while staking-type ETHB posted outflows of $21.99 million. The two products accounted for more than 97 percent of total net outflows from ethereum spot ETFs. There had been net inflows of $53.02 million the previous day, Nov. 4, but outflows on Nov. 5 exceeded that amount.
Other spot crypto ETFs also failed to avoid weakness. Solana spot ETFs saw net outflows of $1.2 million, zcash spot ETFs posted net outflows of $11 million, and hyperliquid spot ETFs recorded net outflows of $3 million. By contrast, XRP spot ETFs had no inflows or outflows.
Against this backdrop, some also viewed the move as easing market overheating. On-chain analytics firm Glassnode said in a report on Nov. 4 it viewed bitcoin's correction as part of an overheating unwind.
Still, the market is now facing a combination of policy uncertainty after the U.S. midterm elections, weakness in large tech stocks and outflows from crypto ETFs. As a result, spot ETF fund flows are more likely to serve as a key indicator for bitcoin and ethereum price swings in the short term. This outflow shows a broader risk-off move across the market in that both bitcoin and ethereum spot ETFs came under pressure at the same time.
