Bitcoin’s rally stalled on 12 January as U.S. spot Bitcoin ETFs recorded another daily negative flow to cap the week. BlackRock’s IBIT led the selling and triggered a wave of real BTC transfers to Coinbase Prime.
According to Lookonchain data, U.S. spot Bitcoin ETFs saw a combined net outflow of 3,734 BTC on the day, equivalent to roughly $339 million at current prices.
BlackRock’s iShares Bitcoin Trust [IBIT] accounted for the bulk of that move, shedding 2,791 BTC, while Grayscale’s products lost a further 891 BTC.
The selling came as Bitcoin struggled to hold above the $91,000–$92,000 range, failing to sustain a breakout after a brief rally earlier in the session.
On-chain data shows BlackRock moved BTC to Coinbase Prime
Blockchain data adds a crucial layer to the ETF flows.
Arkham Intelligence shows that wallets linked to BlackRock’s IBIT sent large tranches of Bitcoin to Coinbase Prime within hours on 12 January. The transactions, visible on Arkham’s tracker, include a long series of transfers of 300 BTC each, alongside a smaller 143 BTC transaction.
In total, the visible deposits exceed 3,400 BTC, broadly matching the size of IBIT’s reported daily outflow.
Source: Arkham Intelligence
Coinbase Prime is the primary settlement venue used by U.S. spot Bitcoin ETF issuers.
When ETF shares are redeemed, authorized participants receive Bitcoin, which is typically routed through Prime before being sold into the spot market or redistributed across trading desks.
The on-chain flows therefore suggest that BlackRock’s ETF redemptions were not simply accounting entries but translated into real Bitcoin being delivered into exchange liquidity pools.
ETF redemptions now act as active sell pressure
The data highlights a structural shift in how Bitcoin trades since the launch of spot ETFs.
While ETFs initially acted as a powerful demand engine in 2024, they now operate in both directions.
When investors withdraw capital, ETF issuers must source Bitcoin from custody and deliver it into the market, turning redemptions into direct sell-side pressure.
On 12 January, BlackRock alone was responsible for nearly three-quarters of total Bitcoin ETF outflows, making IBIT the dominant driver of the day’s liquidity event.
Grayscale’s products also continued to see outflows, though on a smaller scale. At the same time, Fidelity’s FBTC recorded a modest +87 BTC inflow, insufficient to offset the broader selling.
Bitcoin price reaction reflects institutional flows
Bitcoin attempted to extend its January recovery earlier in the day but was rejected above $92,000, before sliding back toward $91,000 as ETF-linked selling emerged.
The timing of the Arkham-tracked deposits aligns closely with the intraday reversal, reinforcing the view that institutional flow, not retail sentiment, is now setting short-term price direction.
With more than 1.29 million BTC now held across U.S. spot Bitcoin ETFs, even modest percentage shifts in investor positioning can translate into thousands of coins hitting the market in a single session.
What this means for Bitcoin’s market structure
The episode underlines how Bitcoin has entered a new phase of market plumbing.
ETF inflows and outflows are no longer just sentiment indicators; they now drive physical settlement flows that ripple directly into spot liquidity.
BlackRock’s transfer of thousands of BTC to Coinbase Prime shows how quickly ETF demand can flip from absorption to distribution.
Price action around key levels is now increasingly influenced by institutional portfolio decisions, rather than just speculative trading.
Final Thoughts
- Because BlackRock’s ETF redemptions injected more than 3,000 BTC of real supply into the market via Coinbase Prime.
- For Bitcoin’s short-term structure, it shows ETF flows now act as a direct source of sell pressure, making institutional positioning a key driver of price.
Source: https://ambcrypto.com/bitcoin-etf-redemptions-explain-why-btc-stalled-near-91k/
