The cryptocurrency market has experienced a significant downturn, marked by substantial outflows from U.S. spot Bitcoin and Ethereum exchange-traded funds (ETFs) and a sharp decline in Bitcoin's price. According to data from Arkham Intelligence, clients of BlackRock’s IBIT ETF alone sold approximately $317.1 million worth of Bitcoin this week, contributing to fresh outflows from addresses associated with the fund. Despite this recent selling pressure, BlackRock still maintains a substantial holding of around $64.34 billion worth of BTC, which was acquired at an estimated average price of $83,200.

This period of intense selling pressure brought an end to a notable six-week streak of inflows for U.S. spot Bitcoin ETFs, which had previously attracted approximately $3.4 billion into these investment products. Data from SoSoValue indicates that the week concluded with roughly $1 billion in net outflows across all spot Bitcoin ETFs. The outflows were particularly severe on certain days: while Monday registered modest inflows of $27.29 million, conditions changed dramatically on Tuesday, which saw investors withdraw $233.25 million. Wednesday became the worst session of the week, with outflows surging to $635.23 million. Although Thursday briefly brought relief with $131.31 million in inflows, the recovery was short-lived, as another $290.42 million exited the funds on Friday, cementing the billion-dollar weekly loss.

The negative sentiment extended beyond Bitcoin, as U.S. spot Ethereum ETFs also recorded significant withdrawals. On May 15, these ETH-focused products experienced $65.65 million in net outflows, marking the fifth consecutive trading day of withdrawals. This synchronized selling across both major cryptocurrency ETFs is indicative of a broader "risk-off" sentiment prevailing in the crypto markets, with traders reducing their exposure in response to recent volatility.

Concurrently with the ETF outflows, Bitcoin itself suffered a sharp retracement during Asian trading hours on Saturday, leading to heavy liquidations for crypto bulls. CoinDesk data showed BTC falling 3.2% over the previous 24 hours, effectively erasing gains accumulated over the past week and pushing its price back towards the $78,000 range after briefly trading above the $82,000 level. This decline reportedly resulted in more than $500 million in losses for bullish leveraged traders who had bet on continued upside in the market.