Bitcoin Drop Linked To Hidden $1.3 Billion ETF Trade, Analyst Reveals

Eight straight days. That is how long US spot Bitcoin ETFs have been bleeding money, with more than $2 billion in net outflows recorded since May 14 — and Tuesday’s session added another ugly chapter to that streak.

A Sell Order Like No Other

A single trader sold over 29 million shares of BlackRock’s iShares Bitcoin Trust ETF on Tuesday through a dark pool, a private trading platform used by institutions to quietly execute large orders away from public markets.

The transaction, valued at $1.3 billion, was executed at $43.16 per share at 2:30 pm UTC. Alex Thorn, head of firmwide research at Galaxy Digital, said it was the biggest dark pool trade in the fund he had ever seen.

Bloomberg ETF analyst Eric Balchunas added more weight to that claim, pointing out that the sell order was more than 22 times larger than the second-biggest IBIT sell order recorded on the same day. The identity of the trader has not been disclosed.

Bitcoin Slid Within Minutes

Price data from TradingView shows Bitcoin fell 1.45% — from $77,870 to $76,721 — within 10 minutes of the trade being executed. The drop did not stop there. Bitcoin continued sliding and hit a 24-hour low of $75,600 roughly 12 hours later, marking a 2.5% loss for the day.

Tuesday’s total outflow from US spot Bitcoin ETFs came in at $333 million, with IBIT alone accounting for over $192 million of that figure. That brings the cumulative outflow since May 14 past the $2 billion mark.

Institutions Pulling Back

The sell-off fits a broader pattern of institutional retreat. Jane Street cut its Bitcoin ETF holdings by around 70% in the first quarter, while Goldman Sachs trimmed its position by 10%.

Bitcoin has historically traded outside the orbit of traditional financial markets, but the rise of US-based Bitcoin ETFs has pulled institutional investors in — and now some are heading for the exit.

Fresh capital entering the market has not been enough to offset the pace of withdrawals, according to reports. Whether Tuesday’s massive dark pool transaction signals a shift in strategy by a major holder, or simply a one-time portfolio move, remains unknown.

Featured image from Unsplash, chart from TradingView