BlackRock buys $111M in Bitcoin as ETF inflows return

BlackRock bought $111 million in Bitcoin on Aug. 4, adding to its spot ETF holdings as the token briefly turned positive after a 50% slide from October's record.

"Long-term holders have returned to accumulation of Bitcoin supply even as ETF flows remain negative," Glassnode said, with several wallet cohorts adding exposure similar to late-cycle bear markets.

The purchase comes as spot bitcoin ETFs returned to net inflows in July after a first half marked by outflows. Citi estimated nearly $3.3 billion left U.S. spot products in 2026, while BlackRock's iShares Bitcoin Trust (IBIT) still holds $47.08 billion in net assets, versus $77.6 billion across the entire spot ETF market.

The accumulation follows a 50% drawdown from October's all-time high of $126,173, with Bitcoin trading near $63,500 as of Aug. 4. Citi cut its 12-month target to $82,000 from $112,000, with a bear case of $53,000 if macro conditions worsen.

ETF flows turn positive after $3.3B first-half exodus

Spot bitcoin ETFs recorded net outflows in each of the three months through June, according to SoSoValue data, as investors chased AI-related returns. K33 Research head Vetle Lunde said "much of the market views the opportunity cost of holding BTC as too high while anything AI-related soars." BlackRock's iShares Future AI & Tech ETF gained 39% through July and held $3.6 billion in assets while the crypto market fell roughly 36% based on the CoinDesk 20 Index.

The first closure of a U.S. spot bitcoin ETF highlighted the pressure. Hashdex will liquidate its $14.7 million DEFI fund after Aug. 17, citing assets under management, liquidity and investor interest, according to a filing with the Securities and Exchange Commission. The fund, which converted from a futures product in late March 2024, was the smallest of the spot ETFs, versus $142.4 million for WisdomTree's BTCW and $47.08 billion for IBIT.

Support at $63,000 as Fed holds rates

Bitcoin traded near $63,500 on Aug. 4, with traders watching $63,000 as the next line of defense after the token broke below $70,000 in February. The Federal Reserve held rates steady at its late-July meeting, and markets priced in one more hike, keeping pressure on risk assets. The 30-year Treasury yield hit a 19-year high of 5.28% as investors demanded more compensation to hold long-term government bonds, BlackRock Investment Institute said.

Citi lowered its base-case 12-month Bitcoin target to $82,000 from $112,000, citing ETF outflows, weak demand and delayed U.S. regulatory approval of crypto ETFs. Its bear case sees $53,000 if macro conditions deteriorate. A sustained recovery depends on ETF inflows turning positive, liquidity improving and institutional demand returning, Glassnode said.

BlackRock's $111 million purchase, while modest against the $47.08 billion in IBIT's net assets, shows the largest asset manager accumulating through the drawdown. If ETF inflows build through August, the token could reclaim $70,000 as resistance; a failure to hold $63,000 risks accelerating leveraged liquidations.

This article is for informational purposes only and does not constitute investment advice.