Overview

Bitcoin’s price has managed to stay above $85,000, but concerns are growing about the dip in flows from spot ETFs and the end-of-year market volatility, which is testing the optimistic views of traders.

Key Insights

• While outflows from Bitcoin ETFs have raised alarm, data suggests institutional investors are not completely abandoning Bitcoin.
• The cryptocurrency has seen a fundamental shift in its correlation to gold, indicating its price behavior remains consistent even amidst recent pressures.

Bitcoin (BTC) experienced a 3% rise on Tuesday, following a drop to $85,000 earlier. Recent data shows a reduction in institutional demand since the crash on October 10th, which has moderated optimistic forecasts without indicating a drastic change in institutional strategies.

Speculative Movements

The withdrawal of $358 million from ETF accounts on Monday marks the largest outflow in three weeks, inciting speculation regarding institutional backing after a significant support level of $90,000 was broken.

Bitcoin is currently trading 31% lower than its all-time high of $126,219, suggesting a potential downturn in the bullish market seen earlier in October.

ETF Net Flows Source: Coinglass

According to insights from user forcethehabit, Bitcoin’s recent declines are not indicative of a change in trends as rising interest rates are still looming and the US Federal Reserve’s balance sheet liquidation continues.

Analyzing Bitcoin’s Relationship with Gold

Understanding Bitcoin’s correlation with gold is essential to see if it is viewed as a viable alternative asset or merely a risky proxy. While Bitcoin’s price movements have been erratic, historical patterns indicate that its appeal as ‘digital gold’ has played a significant role in its valuation throughout 2025.

Bitcoin vs Gold Source: TradingView

Despite seeming pessimistic at a glance, Bitcoin’s substantial decline in price since October hasn’t significantly altered its correlation metrics. This reflects that institutional perspectives might still favor Bitcoin, as it has outshined the S&P 500 index by 7% in the last 18 months.

Final Thoughts

While it might be too early to conclude that institutional money has exited from Bitcoin following this 10-week market correction, historical data suggests the current volatility and liquidity conditions have yet to be factored into market reactions.

This article does not offer financial advice. Always conduct thorough research before making investment decisions.