Foreign media reports indicate that US spot Bitcoin ETFs have experienced significant outflows over the past three weeks, weakening the main source of buying support that had previously supported the market correction. As Bitcoin broke below key price levels, selling pressure further spread to mainstream tokens such as Ethereum and Solana, significantly amplifying market volatility.
ETF outflows continue to weaken support.
The article states that US spot Bitcoin ETFs have recorded net outflows for 13 consecutive trading days, totaling approximately $4.4 billion. Among them, BlackRock's IBIT saw outflows exceeding $3.3 billion.
The report suggests this indicates that some institutional funds are reducing their exposure as the market weakens. Previously, ETF funds absorbed selling pressure in the spot market during pullbacks; however, as this demand weakened, the spot market's ability to absorb the selling pressure subsequently declined.
Bitcoin was already under pressure in the $80,000 to $82,000 range. As ETF outflows accelerated, the price further broke below this level, subsequently falling back to around $60,000.
The decline spread from Bitcoin to altcoins
The article points out that after Bitcoin weakened, defensive sentiment intensified in the market, and funds withdrew from altcoins at an even faster pace. Over the past week, the total market capitalization of the crypto market has declined by approximately 15%, falling to $2.08 trillion; on a monthly basis, the cumulative decline has exceeded 22%.
In this downturn, assets with higher volatility faced more significant pressure. Ethereum, Solana, and other major Layer 1 tokens generally experienced larger declines than Bitcoin.
Meanwhile, Bitcoin's market capitalization share rose to approximately 58%, while the Altcoin Season Index, which reflects the relative strength of altcoins, remained at a low level of over 40, indicating that funds are still biased towards defense.
$1.3 billion liquidation amplifies volatility
In addition to the weakening spot market, the article also attributes this round of decline to the concentrated liquidation of leveraged positions. After Bitcoin and major altcoins broke through key support levels, traders betting on a rebound were liquidated, further amplifying the selling pressure in the market.
In the past 24 hours, the total market liquidation exceeded $1.3 billion, of which long liquidations exceeded $1 billion. By currency, Bitcoin liquidations amounted to approximately $457.5 million, and Ethereum liquidations amounted to approximately $356 million.
The article argues that while this round of clearing has reduced excessive leverage, the market still needs time to digest selling pressure before new buying resumes, and short-term volatility may remain high.
