Investors who bought into Bitcoin (BTC) through US spot exchange-traded funds are now staring at losses, with the cryptocurrency trading significantly below their average purchase price.
What Happened
According to data from Glassnode analyst Sean Rose, the typical ETF buyer paid around $84,100 per Bitcoin, Bloomberg reported.
With prices hovering near $79,000, that translates to paper losses in the range of 8% to 9%.
This isn't the first time these investors have found themselves in the red.
A similar situation emerged in November when Bitcoin dipped below the average cost basis, testing the resolve of newer market participants.
While earlier buyers from the start of 2024 remain in profit, those who allocated later are now underwater.
A 35% Drop From The Peak And Counting
Bitcoin has fallen more than 35% from its 2025 high, briefly dropping below $77,000 over the weekend amid thin trading volumes.
The decline reflects a combination of factors including dwindling inflows, tighter liquidity, and weakening macroeconomic appeal.
Notably, Bitcoin has stopped responding to traditional catalysts like a weaker dollar or rising geopolitical tensions. ETF inflows surged briefly in early January but have since reversed.
Several funds have recorded consistent outflows as both retail and institutional appetite cools.
Rose noted that investors have grown more cautious, preferring to wait for clearer macro signals before adding positions.
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Corporate accumulation has also slowed, reinforcing the broader hesitation.
No Panic But No Buyers Either
Unlike previous corrections that triggered panic selling, the current environment is marked more by absence than alarm.
The rally that pushed Bitcoin above $125,000 earlier this year was driven by optimism around regulatory clarity and institutional adoption. But after October's crash liquidated billions in leveraged positions, many of those buyers have yet to return.
K33 researcher Vetle Lunde observed that the current drawdown relative to cost basis ranks as the second deepest on record.
Without a compelling new narrative, analysts caution that the market risks entering a negative feedback loop, falling prices discourage new buyers, which in turn deepens the slump.
$107 Billion In Assets But Questions Remain
Still, the ETF category retains a significant footprint.
Despite recent outflows, spot Bitcoin ETFs collectively hold around $107 billion in assets, a substantial presence for a product class that didn't exist in the US just two years ago.
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