BlackRock's flagship bitcoin ETF is bleeding money at an unprecedented rate, with $2.2 billion fleeing the fund this month as the crypto market suffers its worst performance since 2022. The massive exodus from the iShares Bitcoin Trust ETF signals a dramatic shift in institutional sentiment as bitcoin plunges over 40% from its October highs, leaving investors scrambling for the exits.
The crypto winter just got a lot colder for BlackRock. The world's largest asset manager is watching investors flee its bitcoin ETF at a pace that's rewriting the record books, with $2.2 billion in outflows this month alone turning November into the fund's worst performance since launching in early 2024.
The hemorrhaging represents nearly eight times the $291 million that exited the iShares Bitcoin Trust ETF last October, which until now held the dubious honor of the fund's second-worst month. But as bitcoin continues its spectacular fall from grace, even those losses look modest by comparison.
Bitcoin's brutal November decline is driving the exodus. The digital asset has crashed over 20% this month and sits more than 40% below its early October peak of just north of $126,000. At current levels around $87,907, bitcoin is enduring its worst monthly performance since June 2022, when it tumbled 39% during the crypto market's last major collapse.
"There's no doubt that hot-money investments have had significant outflows," Jay Hatfield, CEO and portfolio manager at Infrastructure Capital Advisors, told CNBC. "The pullback is really focused on the gambling part of the market, and bitcoin is really the poster child for that."
The timing couldn't be worse for crypto evangelists who've spent years courting institutional money. Just as traditional finance seemed to embrace digital assets through ETFs, a perfect storm of economic uncertainty is sending investors running for safer ground. Recent data from the University of Michigan shows consumer sentiment has nosedived to near record-low levels, while crucial retail sales and producer price index reports due Tuesday have markets on edge.
Fed policy remains another wild card. While the CME FedWatch Tool shows traders pricing in more than 80% odds of a December rate cut, nothing's guaranteed in this environment. That uncertainty is pushing institutional money toward traditional safe havens like gold, leaving crypto assets in the dust.
