Bitcoin News Today: Crypto Panic Intensifies as BlackRock Offloads $815M Holdings

BlackRock's recent movements of over $815 million in Bitcoin and Ethereum have intensified concerns about a potential sell-off and deepened uncertainty in the crypto market, as institutional outflows and price declines collide. The transfers, which include multiple large deposits to Coinbase Prime, coincide with record outflows from the asset manager's ETFs and a broader selloff in digital assets.

The largest single-day outflow from BlackRock's iShares Bitcoin Trust (IBIT) reached $523 million on November 19, marking its worst redemption since the fund's January 2024 launch. This follows a $642 million deposit of 4,880 BTC and 54,730 ETH into Coinbase Prime on November 17, according to on-chain analytics firm Lookonchain. A second transfer of $478 million in Bitcoin and Ethereum occurred just 24 hours later, signaling a rapid and coordinated effort to liquidate holdings. The combined value of these moves-spanning BTC and ETH-exceeds $815 million, with Bitcoin dropping below $94,000 and Ethereum nearing $3,140 in the wake of the transfers.

Market analysts have interpreted the activity as a sign of institutional distress. "Institutions don't send half-a-billion dollars worth of crypto to an exchange without purpose," said Ted Pillows, a crypto analyst, noting the transfers could indicate a large-scale sell-off. The timing aligns with a broader slump in crypto markets, where Bitcoin has fallen nearly 30% from its October peak, and Ethereum has lost over 20% of its value. The Fear and Greed Index, a sentiment gauge, dropped to 14-the lowest level in months-highlighting extreme panic.

The selloff is compounding pressure on BlackRock's ETFs. November is on track to be the worst month for U.S. spot Bitcoin ETFs, with cumulative outflows approaching $3 billion. BlackRock alone accounts for $2.1 billion of those redemptions, including $1.38 billion in Bitcoin and $689 million in Ethereum outflows over the past week. Ethereum has been hit harder proportionally, with outflows representing 4% of its AUM, compared to 2% for Bitcoin.

The asset manager's actions have also raised questions about its broader strategy. While BlackRock has not publicly explained the transfers, the firm recently registered a new staked Ethereum ETF in Delaware, signaling plans to expand its crypto product lineup. This move contrasts with its current ETF outflows, suggesting a potential reallocation of resources. Meanwhile, BlackRock's continued offloading of Bitcoin and Ethereum without significant new purchases has fueled speculation about a shift in institutional sentiment.

Market watchers warn that the selling could exacerbate downward momentum. "ETF outflows combined with long-term holder sales have tightened liquidity," said Dilin Wu, a research strategist at Pepperstone. The concern is amplified by a broader macroeconomic backdrop, including uncertainty around U.S. monetary policy and a potential delay in Federal Reserve rate cuts. Options traders are increasingly hedging against further declines, with protection buying for Bitcoin falling below $80,000 by late December.

The crypto market's fragility is further underscored by the performance of other ETFs. The XRP ETF, for instance, saw a $15.5 million outflow in its first week, ending a streak of inflows that began after the asset's 2023 regulatory resolution. Such trends reflect a broader loss of appetite for digital assets, particularly among institutional investors.

BlackRock's moves come as crypto markets grapple with a third consecutive week of outflows, with total assets under management falling 27% from their October peak to $191 billion. The U.S. accounted for $1.97 billion of last week's outflows, while Switzerland and Hong Kong saw smaller but notable withdrawals. Analysts attribute the downturn to a combination of macroeconomic uncertainty and aggressive selling from large crypto holders.

As the market digests these developments, the focus remains on whether BlackRock's actions represent a temporary liquidity adjustment or a more permanent shift in institutional positioning. For now, the firm's rapid sell-off has amplified fears of a prolonged bear phase, with Bitcoin and Ethereum trading near multi-month lows.