The Resilient Illusion: Bitcoin ETFs in the Market of Shadows

by

Markets

What to know:

  • Bitcoin spot ETFs in the United States still hold about $85 billion in assets, despite the BTC price crash.
  • Analyst Markus Thielen argues that this resilience reflects structural ETF ownership dominated by market makers, arbitrage-focused hedge funds and not just long-term holders.

In the shadow of collapse, where numbers dance like phantoms, Bitcoin’s ETFs cling stubbornly to their billions. Yet this defiance is no parable of faith-it is the hollow echo of gamblers shuffling chips on a sinking ship.

Markus Thielen, that weary chronicler of market truths, scoffs at the myth of the “bullish signal.” The real heroes of this tale, he insists, are not dreamers but dealers-those ghostly hands that flip contracts like so many playing cards, their bets hedged and hearts neutral.

Bitcoin’s price, once a gilded $126,000, now limps toward $60,000, a pauper in its own story. Yet the 11 U.S. spot ETFs, with their $85 billion hoard, stand like gilded tombs. Over 6% of the world’s Bitcoin supply, locked away-not by visionaries, but by the cold calculus of arbitrageurs.

Some analysts, perhaps too eager to drink the Kool-Aid, cite this as proof of bullishness. They are either blind or paid to be. Thielen, ever the realist, points to the 13F filings: 55% to 75% of BlackRock’s $61 billion IBIT ETF, he notes, belongs to market makers and hedge funds. Their positions? Hedged. Their bets? Neutral. Their faith? A farce.

Market makers, those silent puppeteers of liquidity, thrive on spreads, not dreams. Arbitrage funds, with their double-barreled strategies, profit from the very cracks in the system. Neither side bets on Bitcoin’s soul-they trade in its corpse.

And yet, even these shadow-dwellers have trimmed their exposure by $1.6 to $2.4 billion since October. Proof, Thielen says, that the “speculative demand” has withered. Reduced arbitrage? A symptom, not a solution.

The market, in its infinite irony, masquerades as stable while its foundations rot. The ETFs’ “resilience” is but a curtain drawn over the void. One wonders: when the next storm comes, will the arbitrageurs flee first, or will they vanish like smoke, leaving only the believers to weep over their shattered coins?

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2026-02-18 09:23