U.S.-listed bitcoin ETFs have remained remarkably steady despite bitcoin’s sharp pullback, underscoring a widening gap between ETF investor behavior and on-chain market dynamics.

Assets under management in U.S. spot bitcoin ETFs have slipped just 3.6% from their peak when measured in BTC terms—far less than bitcoin’s roughly 25% decline from its October all-time high. The resilience suggests ETF flows are not the primary force behind the recent market downturn.

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Short-Term Holders Deep in the Red

Short-term holders (STHs)—entities that have held bitcoin for fewer than 155 days—are now almost entirely underwater on their recent purchases, according to Glassnode.

Bitcoin traded near $104,000 on June 15, the cutoff for current STH classification. With spot prices now around $84,700, nearly all coins bought since mid-June sit above current market levels.

Glassnode data shows 2.8 million BTC held by STHs are at a loss, the highest underwater supply for this cohort since the FTX collapse in November 2022, when bitcoin hovered near $15,000.

Bitcoin’s current drawdown remains within the normal 20%–30% pullback range typical of bull-market corrections. But market stress has been intensified by the behavior of longer-term holders.

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Long-Term Holders Are Distributing

In contrast to STHs, long-term holders (LTHs) have been steadily reducing exposure. Glassnode reports that LTH supply has fallen from 14,755,530 BTC in July to 14,302,998 BTC as of Nov. 16—a reduction of 452,532 BTC.

“Many long-standing holders have chosen to sell in 2025 after many years of accumulation,” said Bitcoin OG and Fragrant Board Director Nicholas Gregory, noting that the sales appear “lifestyle driven” rather than rooted in negative sentiment. The launch of U.S. ETFs and bitcoin’s break above $100,000 provided a compelling liquidity window, he added.

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ETF Demand Holds Steady

Despite bitcoin’s correction, U.S.-listed spot ETFs remain historically well supported. Measured in BTC terms, current AUM stands at 1.33 million BTC, down only modestly from the all-time high of 1.38 million BTC set on Oct. 10.

Using BTC-denominated AUM helps avoid distortions caused by price swings and shows that ETF investors have largely maintained their allocations. This divergence reinforces the view that the current drawdown is being driven more by long-term holder distribution than by ETF outflows.