Bitcoin exchange-traded funds (ETFs) overseen by institutional investors shrank in early 2025, marking the first quarterly drop since US spot ETFs launched.
According to a recent CoinShares report, institutional investors’ exposure to Bitcoin (BTC) dropped to $21.2 billion in Q1 2025 from $27.4 billion in Q4 2024, representing a 23% decrease over the period.
The report, based on companies’ filings with the US Securities and Exchange Commission (SEC), attributed much of the decline to an 11% quarter-over-quarter drop in Bitcoin’s price, rather than a reduction in position sizes. Still, many investors trimmed their holdings, signaling a mix of valuation impact and active selling.
A notable exception to this trend among professional money managers was financial advisers, who slightly increased their Bitcoin holdings in Q1 2025.
According to the analysis, the last business quarter was driven by corporate Bitcoin adoption for treasury and reserve purposes, rather than professional money managers buying ETFs, reflecting a transition toward long-term savings strategies instead of short-term profit tactics.
On May 30, BlackRock's iShares Bitcoin Trust (IBIT) experienced its biggest day of outflows on record, with over $430 million exiting the investment vehicle after 31 days of consecutive inflows.
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ETF inflows mixed bag in Q1 as companies gobble up Bitcoin for corporate treasuries
Bitcoin treasury companies collectively hold over 1.98 million BTC at the end of the quarter, representing an 18.6% year-to-date increase, according to CoinShares.
Data from SaylorTracker shows that Strategy, the leading Bitcoin treasury company, acquired 15,355 BTC on April 28 and has accumulated BTC in 17 out of the 20 weeks leading up to June 2025.
Meanwhile, ETF flows during the first half of 2025 have been mixed, with headline-driven macroeconomic news altering investors’ sentiment.
While many asset managers initially shifted from risk-on assets to traditionally safer options like US government securities, rising bond yields suggest that confidence in these havens could be eroding. Some analysts predict that Bitcoin's long-term upside profit could be driven by a weaker market for US bonds and not necessarily by ETF inflows.
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