“Tax Loss Harvesting” Drives $825M Outflow From Bitcoin ETFs This Week: Analyst

Core Insights - U.S. spot Bitcoin ETFs have experienced eight consecutive days of institutional selling, with total outflows reaching approximately $825 million, primarily driven by year-end tax strategies and tax loss harvesting, expected to conclude soon [1] - A significant geographic shift is occurring in Bitcoin markets, with the U.S. as the main seller and Asian buyers emerging as the primary accumulation force, marking a reversal from traditional capital flow patterns [2][3] - Whale activity on Binance has sharply declined, with large holder deposits dropping nearly 50% from $7.9 billion to $3.9 billion, indicating reduced selling pressure and less immediate liquidation risk [3][4] - Bitcoin's market behavior has decoupled from traditional assets, with its correlation to the Nasdaq nearing zero and turning negative against gold, suggesting it is establishing its own market regime [5][6] Summary by Category Institutional Selling - U.S. spot Bitcoin ETFs recorded total outflows of approximately $825 million over eight days, primarily due to tax loss harvesting [1] - On December 24, U.S. spot Bitcoin ETFs saw net outflows of $175 million, with BlackRock's IBIT leading at $91.37 million [2] Geographic Market Dynamics - The U.S. is currently the dominant seller in Bitcoin markets, while Asian buyers are stepping in as the primary accumulation force [2] - This shift represents a notable reversal from historical capital flow patterns in crypto trading [3] Whale Activity - Whale deposits on Binance have decreased significantly, with large holder deposits falling from $7.9 billion to $3.9 billion [3] - Monthly whale inflows also dropped from approximately $7.88 billion to $3.86 billion in December, indicating a halving in just weeks [3] Market Behavior and Correlation - Bitcoin's correlation with traditional assets has diminished, with its relationship to the Nasdaq approaching zero and turning negative against gold [5] - This decoupling suggests that Bitcoin is no longer trading like a tech stock or safe haven, instead developing its own market regime [5][6]