I’ve noticed something interesting in the behavior of these Bitcoin ETF funds these days. It seems that price movements are not following what Bitcoin is doing; rather, it’s exactly the opposite—outflows from investment funds are what are pushing the price down. In just the past two weeks alone, about $250 million has left ETF funds, and Bitcoin has fallen by roughly 5.5% to lower levels. What’s striking is that this has nothing to do with Bitcoin news itself, but instead with inflation reports and overall market sentiment.

This isn’t the first time this year. In January, when the Federal Reserve didn’t change interest rates, there was a massive sell-off wave from bitcoin ETF price funds—more than $3 billion over ten consecutive days. Bitcoin’s reaction was sharp: it dropped by about 40% from its peak at $97,000. The level hasn’t been retested yet, despite a later stabilization in flows.

Now Morgan Stanley is filing an application to launch a new spot Bitcoin exchange-traded fund. But the timing isn’t right. Institutions have already pulled about $15 billion from Bitcoin funds since the start of the year, inflation is still adding pressure, and expectations of rate cuts are fading. All of this means that bitcoin ETF price and market movements will likely remain under downward pressure in the period ahead. Any new fund could face real challenges unless macro conditions improve. The big picture is clear: ETFs have become a strong indicator of short-term Bitcoin movements, and the current signals are bearish.