A report from Galaxy Research indicates that hedge funds and banks were the primary sellers of U.S. spot Bitcoin ETFs during the market decline in 2026. Institutions filing 13F reports reduced their holdings from 355 000 BTC in September 2025 to 307 000 BTC by June 2026, marking a 14% decrease.
Nine major firms, including Millennium Management, Goldman Sachs, and Tudor Investment, accounted for the majority of this exit. These institutions collectively reduced their exposure by 68 000 BTC, valued at approximately $5,4 billion, cutting their positions by 29% to 100%.
In contrast, wealth management platforms and sovereign funds, such as Abu Dhabi’s Mubadala and the Abu Dhabi Investment Council, increased their holdings. While hedge funds exited, other filers added roughly 20 000 BTC, worth about $1,6 billion, to their portfolios.
Galaxy Research attributes the exodus to the collapse of the cash-and-carry trade. The basis gap between spot ETFs and CME Bitcoin futures narrowed significantly, with returns falling to about 1,5 points over cash after costs. This reduced the incentive for multi-strategy desks to maintain these positions.
Data from the CFTC confirms this shift, showing a 57% drop in net long positions held by asset managers. Since the June 2026 low, market activity has shifted toward directional buying, with funds adding 87 000 BTC. Recent ETF flows remain volatile, with periodic inflows and outflows reported throughout October.
