As the cryptocurrency landscape continues to evolve, the financial products designed to offer exposure to Bitcoin are facing turbulent waters. Recent reports indicate that Bitcoin exchange-traded funds (ETFs) in the United States have experienced significant net outflows, largely spurred by market anxiety over U.S. President Donald Trump’s proposed cryptocurrency reserve plan.
On March 4, data from SoSoValue revealed that the 12 Bitcoin ETFs recorded net outflows totaling $143.43 million, nearly doubling the previous day’s net inflows of $74.19 million. This dramatic shift highlights the growing skepticism among investors amid shifting regulatory landscapes and geopolitical considerations.
Prominent funds such as Fidelity’s FBTC and ARK 21Shares’ ARKB faced substantial outflows, reporting net redemptions of $46.08 million and $43.92 million, respectively. Franklin Templeton’s EZBC followed suit with net redemptions of $35.71 million, while other notable ETFs like Bitwise’s BITB, Invesco Galaxy’s BTCO, and WisdomTree’s BTCW also saw diminished interest, with outflows of $23.96 million, $16.47 million, and $13.07 million, respectively.
Amid this downtrend, Grayscale’s mini Bitcoin Trust managed to stand apart by recording a net inflow of $35.77 million, providing a glimmer of hope in an otherwise bleak day for Bitcoin ETFs. The cumulative trading volume across these ETFs reached an impressive $4.55 billion on March 4, yet the total net inflows since their inception have reached $36.72 billion, showcasing their potential despite current challenges.
Ether ETFs Return to Inflows
In contrast to the Bitcoin ETFs, Ethereum ETFs showed a resurgence on the same day, transitioning back to net inflows after an eight-day streak of withdrawals. A total of $14.58 million flowed into the nine Ethereum funds on March 4, marking a recovery that many investors welcomed.
Leading the charge was Fidelity’s FETH, which attracted $21.67 million. Grayscale’s ETHE and the mini Bitcoin Trust also contributed positively with inflows of $10.71 million and $8.46 million, respectively. However, the day was marred somewhat by BlackRock’s IBIT, which saw outflows of $26.27 million. Perhaps interestingly, the remaining five Ethereum ETFs maintained a neutral stance, showing no noticeable inflows or outflows.
Trump’s Crypto Reserve Plan Triggers Market Concerns
The uptick in outflows from Bitcoin ETFs coincided with market reactions to Trump’s recent proposal to establish a U.S. Crypto Strategic Reserve. Quantified as a significant move to position the U.S. as a “Crypto Capital of the World,” the proposed reserve would include a mix of cryptocurrencies, with a primary focus on Bitcoin and Ethereum.
Despite its strategic intent, the plan has been met with skepticism from various corners of the cryptocurrency community. Critics argue that it contradicts the fundamental tenets of Bitcoin, particularly its decentralization and freedom from governmental oversight. Concerns are running high that a reserve managed by the U.S. could introduce unwanted influences into what is intended to be a free-floating currency.
Anthony Pompliano, CEO of Professional Capital Management and a noted figure in the crypto investment sphere, voiced his dissent in a recent letter to clients, labeling the proposal as a “mistake” that the U.S. would ultimately regret. He articulated fears that the policy might act as a “random mix of speculative assets” primarily benefiting insiders and token creators, rather than serving the interests of U.S. taxpayers.
As Bitcoin initially surged to an intraday high of $94,770 on March 3—a gain of 11%—it subsequently retraced nearly 13.8% to land around $81,700 the following day, illustrating the volatile nature of the market amid growing uncertainties. Ethereum also mirrored this trend, slipping 19% from its high to approximately $2,055 on March 4, though both assets have shown some recovery since then, with Bitcoin now trading at $87,163—and Ethereum at $2,180—each reflecting an uptick of 3.6%.
Bitcoin’s Struggles in 2025
Diving deeper into market dynamics, Uldis Teraudklans, chief revenue officer at Paybis, pointed out that Bitcoin has struggled throughout 2025, experiencing a year-to-date drop of 11.47%, while traditional safe-haven assets like gold have gained 10.65% in the same period. Perhaps most telling was a Bank of America survey that indicated 58% of fund managers still regard gold as a reliable store of value amidst trade tensions. In contrast, only 3% seem to trust Bitcoin, a clear demonstration of the shifting sentiments.
Teraudklans emphasized that Bitcoin’s responsiveness to macroeconomic forces, including trade wars and fluctuating interest rates, illustrates its current volatility, particularly with Wall Street firms having a heightened exposure to it. He noted that February was particularly harsh for Bitcoin, which saw a staggering plunge of 17.39%, marking its worst February performance since 2014 and the only negative month in a post-halving year—entirely attributable to a waning institutional appetite and growing correlations with traditional market indices like the S&P 500.
In summarizing Bitcoin’s long-term prospects, Teraudklans argued that the asset has never truly functioned as a safe haven—only as an aspirational one. He observed that each market cycle reignites debates over Bitcoin’s role as a hedge, while also acknowledging its enduring volatility. “Only when Bitcoin reaches the market capitalization of gold can we seriously evaluate whether it can replace it as a safe-haven asset,” he concluded, indicating a cautious outlook for the digital currency as it navigates through challenging times.
