Who’s Really Selling Bitcoin? Bitwise CIO Reveals What ETF Flows Show

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Bitcoin is down over 45% from its October 2025 peak, spot crypto fund AUM has dropped to $130 billion, and roughly 40% of spot Bitcoin ETF holders would need a 50% recovery just to break even.

But according to Bitwise CIO Matt Hougan and GraniteShares CEO Will Rhind in a recent CNBC interview, the people selling are not who most expect.

ETF Investors Are Not Driving the Bitcoin Sell-Off

Net outflows from Bitcoin ETFs have been roughly $7 billion, a small number compared to total AUM. Most of the decline comes from price drops, not redemptions.

The primary sellers are long-term, original crypto holders who built positions over 15 years and are now trimming. On the other side, financial advisor channels have been buying the dip.

Hedge funds and short-term traders within the same ETFs are the ones creating outflows, which masks the advisor-side buying entirely.

Hougan described it as two different markets inside the same product: fast money trading the next month versus long-term allocators investing over 4-5 years.

Gold Puts Pressure on Bitcoin

Gold breaking past $5,000 an ounce while Bitcoin falls has made things harder for crypto investors.

Rhind addressed it:

This Bitcoin Bear Market Looks Different

In past bear markets, Bitcoin retraced 77-85%. This time, the drawdown sits at around 50-52%. Hougan said ETF-based long-term holders may be the reason for the shallower drop, acting as a price floor even if they have not prevented major losses.

Outflows have also slowed to just under $200 million despite heavy price pressure, which has historically signaled a possible turning point.

Wall Street Firms Open Doors to Crypto

All four major firms, Morgan Stanley, Merrill Lynch, Wells Fargo, and UBS, now allow exposure to crypto products. Morgan Stanley has filed to launch its own spot Bitcoin ETF after clearing its roughly 15,000 financial advisors to pitch existing products.

Hougan said a sharp recovery is unlikely.