Bitcoin ETFs see $515M net withdrawals in October amid Binance hack

U.S. spot Bitcoin exchange‑traded funds recorded a net outflow of $515 million in October, a decline that coincides with the Binance hack that shook investor confidence. Ether‑focused funds posted an even larger monthly exit, shedding a record $1.61 billion.

Outflows Amid Security Concerns

The Binance incident, which exposed significant security vulnerabilities, appears to have prompted investors to pull capital from both Bitcoin and Ether ETFs. The timing of the withdrawals suggests that concerns over custodial safety and regulatory scrutiny are influencing fund flows.

Large withdrawals from ETFs can reduce the amount of capital available to purchase underlying digital assets, potentially tightening liquidity in spot markets. This, in turn, may affect price volatility as trading volumes adjust to the new supply‑demand balance.

Market participants may also interpret the outflows as a signal of broader caution toward crypto‑asset exposure, especially in the context of heightened regulatory attention. Consequently, the flows could influence how other asset managers approach crypto‑related products in the near term.

Overall, the exit of capital from Bitcoin and Ether ETFs highlights the sensitivity of crypto investors to security incidents and the potential ripple effects on the broader digital asset ecosystem.

Based on reporting from Cointelegraph. Read the original.