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Bitcoin ETF redemptions are moving like an institutional bear market
Since the SEC approved in-kind redemptions in July 2025, Bitcoin can leave ETF trusts without the funds having to sell it on the market, changing where the selling pressure shows up.
In an institutional bear market, Bitcoin ETF redemptions can become routine, according to CryptoSlate, with investors selling shares and authorized participants returning Bitcoin blocks to the trust. The trust can then pay cash or transfer BTC out, while the fund shrinks and its custodian continues operations.
CryptoSlate says that since the SEC approved in-kind redemptions in July 2025, the process allows coins to leave through ETF mechanisms without forcing the trust to sell on the open market. That is a shift from earlier exits in 2022, when redemptions often began with disabled withdrawal pages and could end in bankruptcy court.
The outlet also links the evolving mechanics to market behavior in 2026, citing price swings including Bitcoin trading below $59,000 on July 1 after reaching $126,223 in October 2025, and recovering to roughly $64,000 in early August. Reuters calculations cited by CryptoSlate peg 2026 losses at 33% by early June, and the article describes a deeper leg that erased about 53%.
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