Why Wall Street refuses to sell Bitcoin – and actually bought way more – even while losing 25% of its value
Institutional investors increased their Bitcoin ETF holdings in Q4 2025 despite a 25% price drop, suggesting strong conviction or arbitrage activity.Summary
Despite Bitcoin's price falling sharply by nearly 25% in the fourth quarter of 2025, institutional investment managers increased their allocations to US spot Bitcoin ETFs. Analysis of 13F filings showed 121 institutions increased their net share count by 892,610 shares between Q3 and Q4 2025. Paradoxically, the aggregate dollar value of these holdings decreased due to the price drawdown, indicating institutions were buying into the dip. For instance, BlackRock's IBIT attracted $25.4 billion in fresh cash inflows in 2025 despite posting a 10% loss. However, this accumulation might not solely reflect long-term bullish conviction. Spot Bitcoin ETFs are used for market-neutral arbitrage, such as basis trades where managers buy the ETF (disclosed in 13F filings) while simultaneously shorting Bitcoin futures (undisclosed). If the buying was driven by arbitrage, the capital is mercenary and could reverse quickly; if driven by genuine allocation, the capital is likely stickier.
(Source：CryptoSlate)