US spot Bitcoin ETFs shed $484.9 million on Oct. 7, their largest one-day outflow since June 25, according to Decrypt's ETF tracker. BlackRock's IBIT accounted for $207.7 million of the redemptions, with Fidelity's FBTC second at $105.1 million.

The single session erased roughly 81% of the capital that entered the funds over the previous nine trading days. In effect, about two weeks of sustained buying unwound in one afternoon. The products still hold $57.8 billion in cumulative net inflows, so the outflow marks a sharp repricing rather than a structural exit.

For October through the 7th, the ETF complex is now down $163.3 million. The funds had opened the month with $321.6 million of inflows across four sessions before the reversal.

What drove the outflows?

The pressure came from the macro backdrop rather than anything crypto-specific. The 30-year Treasury yield climbed to roughly 5.7% on Wednesday, its highest level since 2002, while Brent crude settled near $100 a barrel and equities slid from record highs.

Shipping attacks around the Strait of Hormuz have continued — at least one per day since Oct. 2 — reinforcing upward pressure on oil prices. Expensive oil feeds inflation, a hawkish Federal Reserve keeps yields elevated, and elevated yields raise the opportunity cost of holding a non-yielding asset through an ETF wrapper. When a 10-year Treasury pays more than 5% and does not draw down 6% in a few sessions, institutional allocations shift accordingly.

What did the Fed minutes show?

The Fed raised rates in September for the first time since 2023, and minutes from that meeting, released Wednesday, show most officials expect another hike before year end. Markets disagree with that guidance.

• CME FedWatch prices an October hike at 19.4%.
• Myriad's prediction market puts the probability at 17%.
• The September minutes set no date for the next increase.

The Federal Open Market Committee next meets Oct. 27-28, then Dec. 8-9.

How hard did Bitcoin and derivatives markets get hit?

Bitcoin traded as low as $81,749.83 on Thursday, roughly 6% below the $86,978 peak recorded earlier in the week. Long positions bore the brunt of the move in derivatives markets: approximately $429 million in positions were liquidated over 24 hours, and 87.5% of those were long bets, according to CoinGlass.

The drawdown also dents a seasonal pattern. Bitcoin had posted October gains six years running until last year, when it fell 3.69%. With 23 days left in the month, the ETF complex has already flipped from a $321.6 million October surplus to a net outflow position.

The next directional test arrives with the FOMC's Oct. 27-28 meeting, where the gap between the committee's hiking bias and market pricing of under 20% odds will either narrow or force a further repricing across rate-sensitive assets, Bitcoin ETFs included.