The milestone marks a sharp reversal from a strong start to 2026. In the first quarter alone, Bitcoin ETPs (exchange-traded products that hold Bitcoin on behalf of investors) took in $18.7 billion in net inflows, putting the sector on pace to exceed both the 2024 record of $48.7 billion and the 2025 total of $47.2 billion. That trajectory collapsed after a hotter-than-expected U.S. CPI print on May 12 triggered two consecutive waves of institutional selling.

Bitcoin was trading near $61,100 to $62,600 as of June 24, 2026, down roughly 51% from its October 2025 all-time high of approximately $126,200.

Two Waves, One Reset

K33 Research documents the outflows in two distinct streaks. A 10-session run between May 15 and May 28 shed an estimated $2.8 billion to $3.5 billion. A second streak spanning approximately June 1 through June 13, totaling 13 consecutive sessions, drained a further $4.4 billion, the longest such run since U.S. spot Bitcoin ETFs launched in January 2024. The monthly net outflow reached approximately $2.43 billion, the largest single-month Bitcoin ETP outflow of 2026, according to K33 Research.

At the peak of the selling pressure, between May 11 and June 13, outflows averaged 4,462 BTC per day. That pace has since dropped sharply. In the two weeks ending June 23, average daily outflows fell to roughly 625 BTC, an 86% reduction.

The selling was concentrated in U.S.-listed funds. BlackRock's IBIT product alone saw approximately $3.3 billion exit. Fidelity's FBTC recorded about $456.6 million in outflows, and Grayscale's GBTC shed a further $303.6 million. During the peak outflow period, U.S.-based products accounted for $1.63 billion of the $1.67 billion in total global crypto fund outflows.

Macro Rotation, Not a Bitcoin Crisis

Analysts at K33 and trading firm Wintermute are consistent in attributing the selling to macro conditions rather than any problem specific to Bitcoin. The Federal Reserve has held its benchmark rate at 3.5% to 3.75%. The S&P 500 has hit record highs above 7,568, driven by artificial intelligence and semiconductor stocks. Anticipated IPOs from companies including SpaceX and Anthropic are absorbing capital that might otherwise sit in crypto. U.S.-Iran geopolitical tensions have elevated oil prices and reignited inflation fears, adding further pressure on risk assets.

The institutional retreat preceded the May outflow streaks. According to 13F filings compiled by Intellectia.ai, the institutional share of Bitcoin ETF assets under management fell from 24.7% to 20.8% between Q4 2025 and Q1 2026, with aggregate institutional BTC holdings declining from 313,000 BTC to 261,000 BTC over the same period.

"Much of the market views the opportunity cost of holding BTC as too high while anything AI-related soars," said Vetle Lunde, Head of Research at K33, in a note published June 2. He added: "With outside capital reluctant to enter and existing holders trimming exposure, we may be in for a choppy summer."

Wintermute's research team reached a similar conclusion. "The two largest structural buyers, ETFs and Strategy, are both contributing less marginal demand than in prior phases," the firm wrote. Strategy (formerly MicroStrategy) has continued purchasing Bitcoin, acquiring 1,587 BTC in one week and 520 BTC the following week, but weaker preferred share prices have constrained its ability to raise capital for new acquisitions. Wintermute described the overall environment in stark terms: "The funnels aren't turning. This is a market stabilizing beneath the surface on lighter positioning and cleaner leverage, not one finding new buyers."

On-Chain: Long-Term Holders Are Not Selling

Despite the institutional outflows, on-chain data from K33 points to a structural divergence. Long-term holders, defined in standard on-chain analytics as addresses that have not moved Bitcoin for approximately 155 days (roughly six months), now control a record 79% of circulating supply.

Only 218,421 BTC older than two years was reactivated through June 6, compared to 1.18 million BTC reactivated at the same point in the 2024 cycle. This reactivation metric tracks coins that had been dormant for at least two years before moving; its historically low reading indicates that holders with the deepest on-chain tenure have not meaningfully reduced their positions. It is institutional product investors, not long-term holders, driving the exits.

Total global crypto ETP assets under management stand at $140 billion, down 15% year-to-date due to price declines, according to 21Shares' mid-year report released June 24. Global Bitcoin ETP holdings total approximately 1.25 million BTC, down 127,774 BTC or 8% from the sector's peak.

What This Means Outside the United States

For retail investors in markets like India, Nigeria, and Kenya, the ETP mechanism itself is largely out of reach. Spot Bitcoin ETFs are not accessible through domestic Indian exchanges. Yet the price consequences arrive in full. K33 documents an R-squared correlation of 0.806 between 30-day Bitcoin price performance and 30-day ETP flows in 2026, meaning institutional selling in New York directly compresses portfolio values in Bengaluru or Lagos.

India holds the top position in the 2026 Global Crypto Adoption Index across 151 countries, but its 30% flat tax on crypto profits and a 1% TDS (Tax Deducted at Source) withholding mechanism suppress trading activity during downturns and disproportionately affect retail participants.

Pakistan presents a related challenge: users there operate largely through peer-to-peer platforms and offshore exchanges with no formal regulatory framework, leaving retail participants fully exposed to global market cycles without consumer protection mechanisms.

In Sub-Saharan Africa, Chainalysis data shows a countercyclical pattern: small retail transfers in Nigeria and Kenya actually increased at the onset of the bear market, reflecting utility-driven use such as remittances and currency devaluation hedging rather than speculative positioning. The 2026 Global Crypto Adoption Index places Nigeria second globally among 151 countries, with Ethiopia at tenth, Kenya at thirteenth, and Ghana at twentieth, up from just two African nations in the top rankings in 2024. Stablecoin volumes across Sub-Saharan Africa surged more than 180% year-on-year, the fastest growth of any region globally, according to Chainalysis data.

What Comes Next

The deceleration in outflow pace is the clearest near-term signal available. Whether it represents genuine stabilization or a temporary pause depends largely on developments the crypto market does not control: Federal Reserve rate guidance, AI equity momentum, and the trajectory of U.S.-Iran geopolitical tensions that have driven up oil prices and reignited inflation fears.

K33's Lunde warned of "possible deeper lows" and called for caution given residual leveraged long positions in the futures market, where CME Bitcoin open interest has dropped to its lowest level since October 2023.

The 21Shares mid-year report offered the longer historical view: the current 51% drawdown, while painful, remains "far milder than the 80-plus percent corrections of previous cycles."