Bitcoin ETFs shed $484.9 million in a single session on Wednesday, their roughest day since June 25. In effect, one trading day wiped out around 81% of the capital that had come in over the prior nine sessions. Two weeks of steady accumulation vanished by the closing bell. BlackRock's IBIT topped the outflow chart at $207.7 million, with Fidelity's FBTC next in line at $105.1 million. The funds still hold $57.8 billion in cumulative net inflows.
Macro, not crypto, drove the damage. The 30-year Treasury yield climbed to roughly 5.7% on Wednesday, a level last seen in 2002. Brent crude finished near $100 a barrel, and equities pulled back from record highs. Attacks on ships around the Strait of Hormuz keep mounting — at least one per day since Oct. 2. Pricier oil stokes inflation, inflation keeps the Federal Reserve hawkish, and a hawkish Fed holds bond yields elevated. That is a hostile backdrop for an asset with no yield of its own, especially with the 10-year Treasury paying above 5%.
The Fed delivered its first rate increase since 2023 in September, and minutes from the latest meeting — published Wednesday — indicate most policymakers expect one more before the year is out. Markets aren't convinced. CME pricing currently implies a 19.4% chance of an October hike, while prediction market Myriad puts the odds at 17%.
In Thursday trading, Bitcoin slid as low as $81,749.83, roughly 6% underneath the $86,978 peak from earlier in the week. About $429 million in derivatives positions were wiped out over 24 hours, and long bets made up 87.5% of them. October had been green for Bitcoin six years running until last year's 3.69% dip. This time, the funds kicked off the month with $321.6 million of inflows across four sessions. They now sit $163.3 million underwater. The Fed's next meetings are set for Oct. 27-28 and Dec. 8-9. The September minutes offered no timing for the next increase.