Bitcoin Market Splits as Steady Institutional Buying Offsets Whale Selling

Bitcoin remained range-bound as steady demand from U.S. spot Bitcoin ETFs collided with selling by miners and institutional holders. The opposing flows have prevented ETF inflows from translating into a sustained rally, underscoring how post-halving miner economics and profit-taking by large holders can offset demand from regulated investment products.

The cryptocurrency recently traded between $62,000 and $66,000, while volumes and volatility fell to multiyear lows. Investors are watching the next U.S. Consumer Price Index release and progress on digital-asset legislation for a catalyst. Softer inflation or greater regulatory clarity could revive risk appetite, while persistent selling may keep Bitcoin confined to its current range.

Since the U.S. Securities and Exchange Commission approved spot Bitcoin ETFs in January 2024, products from BlackRock, Fidelity and others have become key channels for institutional flows into and out of Bitcoin. With the price returning to $60,000, ETF flows are an important gauge of whether the market can absorb selling pressure and hold that level.

Bitcoin briefly returned to around $60,000 on June 7. According to SoSoValue, the 11 U.S. spot ETFs recorded net outflows of $1.72 billion from June 1 to June 5, their largest weekly redemption in more than a year and far above the $318 million withdrawn in the first week of February. By June 30, the ETFs had reduced their holdings by about 71,600 BTC during the month, while corporate treasuries bought just 7,500 BTC, creating a supply overhang of about $4.4 billion.

Bitcoin has held the $67,000 level even as social sentiment fell to its most bearish since late February and the Fear and Greed Index entered “extreme fear,” showing that prices have not deteriorated in step with retail confidence. Morgan Stanley’s approval of a low-fee Bitcoin ETF suggests institutions still view the pullback as a buying opportunity, while ETF demand has also provided important support.

The latest data showed Bitcoin trading at about $67,100. Despite having plunged roughly 50% from its peak, institutional capital has not retreated significantly, and some ETF investors have instead added to their positions on the dip. Morgan Stanley’s newly approved low-fee ETF, together with record Bitcoin ETF inflows in March, has bolstered buying support and underscored the sharp divergence between price and negative sentiment.