The U.S.-listed Spot Bitcoin ETF recorded its biggest single-day outflow in nearly three weeks on Friday, with a total of $349 million across all 11 products, according to data from Pharcyde.
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The withdrawals came as Bitcoin briefly reached $74,000 earlier in the week, before falling toward $68,000. Based on on-chain data, this rally appears to have triggered a significant wave of selling by large holders.
Large holders buy cheap and sell quickly
Crypto analysis platform Santiment tracked the behavior of wallets holding between 10 and 10,000 Bitcoin, a group commonly referred to as whales, and found that they actively built positions between February 23 and March 3, when the price was stuck in the $62,900 to $69,600 range.
Offloads of the same wallets began on Wednesday when Bitcoin rose above $74,000. By Friday, about 66% of the amount accumulated in those 10 days had been sold back to the market.
Small investors moved in the opposite direction. As prices fall, positions in wallets (the retail sector of the market) with less than 0.01 Bitcoin are increasing.
Santiment said this type of divergence between large and small holders historically signals further downside to come.
“Retailers buying while whales are selling typically indicates the correction is not over yet,” the platform said in a report on Friday.
Fear gauge drops to lowest value in weeks
Bitcoin’s decline sent the Crypto Fear & Greed Index down six points to 12 on Saturday, pushing it deep into “extreme fear” territory. This index measures market sentiment across a variety of factors such as volatility, trading volume, and social media activity.
Some analysts said Bitcoin could still face further decline if buyers fail to defend the current price range. A loss of support near the $67,000 to $68,000 range could trigger a move back toward recent lows to gather liquidity before a potential rebound.
Economists’ argument for a $60,000 floor
Not everyone expected the collapse to come. Economist Timothy Peterson pointed to the Bitcoin price vs. Metcalf value chart (a model that measures the price of Bitcoin relative to the estimated value of the network based on user activity) and said the $60,000 level has been held as a floor in every cycle thus far.
“About 99.5% of the time it will stay above $60,000,” Peterson wrote to X.
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Bitcoin has tested that level once this cycle, dropping to $60,000 on February 6th in a broad pullback from its all-time high of $126,000 in October.
Although there has been a partial recovery since then, Friday’s ETF outflows and continued whale selling suggest the market has yet to find stable footing.
Featured images from Shutterstock, charts from TradingView
