Bitcoin fell below $83,000 on October 13 after investors pulled back from riskier assets in anticipation of the upcoming US Consumer Price Index (CPI) report, set for release on October 14. Ongoing net outflows from Bitcoin exchange-traded funds (ETFs) added further pressure to the cryptocurrency market.
ETF withdrawals intensify selling in Bitcoin
Spot Bitcoin ETFs in the United States recorded substantial net outflows, totaling approximately $773 million over four trading sessions from October 7 to October 12, data from Farside Investors showed. The withdrawals reflected weaker institutional demand and compounded uncertainties surrounding the current market environment.
On October 7, investors redeemed $484.9 million from US spot Bitcoin ETFs, marking the largest single-day withdrawal in that period. Another $244.1 million was withdrawn the following day. Although October 9 saw a brief $21.1 million net inflow, outflows resumed on October 12 with an additional $65.4 million leaving these products.
BlackRock’s iShares Bitcoin Trust (IBIT), one of the largest Bitcoin ETFs, experienced $207.7 million in outflows on October 7 alone, indicating the market-wide impact extended even to the sector’s most prominent investment vehicles.
In parallel with the ETF outflows, a broader Bitcoin selloff led to approximately $771 million in cryptocurrency positions being liquidated over a 24-hour period. While both ETF redemptions and forced liquidations contributed to volatility, these figures represent different forms of activity and do not independently account for the recent price decline.
Institutional appetite for Bitcoin has remained subdued, with weaker inflows failing to counterbalance continuing redemptions during this volatility.
| Date | Net ETF Inflows/Outflows | Notable Event |
|---|---|---|
| October 7 | -$484.9 million | Largest single-day outflow |
| October 8 | -$244.1 million | Ongoing withdrawals |
| October 9 | +$21.1 million | Brief inflow |
| October 12 | -$65.4 million | Resumed outflows |
Institutional redemptions from spot Bitcoin ETFs reached $773 million during the week, with BlackRock’s IBIT accounting for $207.7 million of outflows in a single day. These movements, paired with roughly $771 million in crypto liquidations, triggered sharp volatility in the market.
US inflation outlook weighs on Bitcoin’s recovery
The US Bureau of Labor Statistics is scheduled to release September’s inflation data on October 14 at 8:30 a.m. Eastern Time. August’s Consumer Price Index climbed 3.4% year over year, significantly above the Federal Reserve’s stated 2% target, leading to speculation about potential interest rate adjustments.
A higher-than-expected inflation print could increase the likelihood of continued restrictive monetary policy from the Federal Reserve, pushing Treasury yields higher and further pressuring interest-sensitive assets like Bitcoin. Bitcoin, as a non-yielding asset, often faces headwinds when yields rise and traditional markets become less receptive to risk.
Conversely, softer inflation figures may reduce pressure on bond yields and boost investor appetite for alternative assets, including cryptocurrencies.
Market participants are closely watching macroeconomic developments, particularly the impact of rising oil prices and tightening financial conditions on digital asset valuations. These factors have contributed to heightened volatility and cautious positioning among traders.
Expectations around Federal Reserve policy are already shaping investment strategies in Bitcoin, with some investors reallocating away from cryptocurrencies ahead of key economic data releases.
The Federal Reserve, the central bank of the United States, closely monitors inflation and adjusts interest rates to maintain price stability and support economic growth. Policy changes in response to new inflation data can have significant short-term effects on cryptocurrencies and wider financial markets.
Mini dictionary: iShares Bitcoin Trust (IBIT) is BlackRock’s spot Bitcoin exchange-traded fund, allowing investors exposure to Bitcoin price movements through a regulated market product without directly purchasing or holding the cryptocurrency. BlackRock is the world’s largest asset management company.
