Bloomberg: Hedge funds that once fueled the U.S. Bitcoin ETF craze are rapidly withdrawing, with Bitcoin ETF holdings in Q4 2025 decreasing by 28% quarter-on-quarter

According to Bloomberg, hedge funds that once fueled the U.S. Bitcoin exchange-traded fund (ETF) craze are rapidly withdrawing.

Data compiled by CF Benchmarks, a wholly-owned subsidiary of the crypto trading platform Kraken, shows that the total allocation of Bitcoin ETFs held by the largest hedge funds has decreased by 28%. Gabe Selby, head of research at CF Benchmarks, wrote in a research report on February 19: "The dominant theme over the past two quarters has been hedge funds' de-risking operations. The spike and subsequent drop in October seem to have triggered systematic reductions." Brevan Howard significantly adjusted its position in BlackRock's iShares Bitcoin Trust, becoming the largest seller of this spot ETF in the fourth quarter. Its holdings decreased by about 86% to 5.5 million shares, reducing the value of its spot position from approximately $2.4 billion to $275 million. Bitcoin prices have fallen alongside macro risks, and at certain stages, the declines were even greater, undermining the logic previously presented to institutional investors—that Bitcoin could hedge against inflation, currency devaluation, or stock market pressures.