Investment analyst Justin Lin said while the pace of accumulation has slowed over the past quarter, the firm haven’t seen any meaningful outflows.
“We take as a sign that Australian investors may be taking a more long-term view toward digital assets,” he told InvestorDaily.
Bitcoin dipped to under US$93,000 on Monday, a move Lin said was a continuation of weakening sentiment, rather than any meaningful shift in positioning.
“The AI trade hit a speed bump as valuation concerns resurfaced [on Friday], and expectations for a December Federal Reserve rate cut were knocked back after multiple FOMC members pushed back against easing.”
“Bitcoin, which is both a growth-tilted asset with high beta to tech thematics and a non-yielding asset that benefits from lower rates, was hit on both sides of its narrative. In that sense, the sell-off was fairly expected behaviour and not indicative of any hidden structural weakness.”
eToro’s Farhan Badami said the recent pullback is a combination of fading end-of-year US Fed rate cut hopes, institutional outflows and liquidity squeezes.
“It looks like a classic case of momentum-driven selling, with the Fear & Greed Index hitting an extreme low of 10 [on Sunday].”
“In my view, it's less a crypto meltdown and more the market exhaling after a series of high-energy months. I expect a rebound once data fog clears.”
He said ETFs have been a key liquidity driver, and they've largely mirrored the bearish sentiment.
“November has been brutal - especially when compared to October, with cumulative outflows,” Badami told InvestorDaily.
“In general, inflows aren't pulling back; they've evaporated into sustained outflows. That, in turn, is signalling institutional de-risking amid Fed hawkishness, data delays from the US shutdown, and liquidity squeezes. This contrasts with historical patterns, where ETFs absorbed dips in the past.”
K33 Research estimates the average entry price for US spot bitcoin ETF investors at around US$89,613 - effectively the breakeven level for most buyers. A drop back to that price raises the question as to whether it will trigger increased redemptions – but Badami doesn’t believe bitcoin hitting US$89k is cause for concern.
“If BTC dips to US$89K, it's not game-over territory. The drop would represent ~5-6% from here (or ~30% from ATH), fitting historical bull-market corrections. That being said, the Fear and Greed number is really low and with negative funding rates, volatility could spike. It will be very interesting to keep an eye on weekly close, CME gaps, and ETF flows figures over the next few weeks.”
“Unless you're leveraged, it's not worth losing sleep over. We've been here before. It feels more like liquidity hunting in a bull cycle rather than a structural collapse. In fact, I believe many investors will use this opportunity to buy the dip should the price drop to US$89k.”
GlobalX’s Lin said while investor psychology undeniably influences digital assets, ETF investors - along with the institutions that entered the market following the launch of US spot ETFs - tend to show greater discipline and a stronger grounding in fundamentals than what we traditionally see in crypto markets.
“I don’t believe a move toward US$89k poses a meaningful risk from an ETF perspective. The more significant vulnerabilities likely sit in the more speculative corners of the market, such as derivatives.”
Lin said it’s worth noting that Australians have had access to Global X’s spot bitcoin ETFs since mid-2022, when prices were closer to US$20k per bitcoin.
“That earlier entry point means many early adopters are likely still well above water and nowhere near their “pain point”,” he said.
As for other crypto assets, Lin observed there was no significant underperformance by any of the blue-chip altcoins over the weekend, which suggests that it was a broad-based sentiment driven move that had little to do with fundamentals and more to do with general portfolio repositioning.
“Given that rotation into low-beta, risk-off sectors, was a recurring theme last week, it does appear that the drawdown in crypto was not targeted, but rather a sign of broader risk-off sentiment.
Lin believes investor focus should be less on pinpointed support or resistance levels and more on the volatility profile of the crypto space.
“One of the emerging narratives this year has been bitcoin’s evolution into an alternative store of value, possibly even a ‘safe haven’ asset, given its perceived detachment from geopolitics, inflation, and the US dollar,” he said.
“These claims are easy to make in a bull market, but their credibility is only tested when conditions turn less favourable. Investors should watch closely to see whether bitcoin’s behaviour has genuinely shifted from previous cycles, or whether this narrative proves to be just that - a narrative.”
While crypto investors hope that crypto acts independently and is not correlated to the stock markets, eToro’s Badami said the reality is based on past data, crypto usually moves in the same direction as the stock market, but in a more dramatic fashion.
“Investors are now looking to move into more defensives to protect themselves from the risk and uncertainty we’re seeing.”
While there isn’t real-time visibility into how Australian institutions are adjusting their allocations, Lin said there is a short-term historical read on US institutional positioning through 13F filings.
“The newly released Q3 2025 data suggests that institutions have been largely unfazed by the recent volatility in crypto. The number of active holders of the largest US-listed bitcoin ETF rose by roughly 11% quarter-on-quarter, and the value of their holdings increased from US$23 billion to US$25 billion,” he told InvestorDaily.
“The pace of accumulation may not be as aggressive as it was earlier in the cycle, but institutional adoption has remained resilient and continues to build momentum.”
eToro’s Badami said institutional investors remain firmly entrenched in bitcoin, holding BTC exposure via ETFs, treasuries and direct custody.
“Despite the dip, they're not fleeing en masse. What I’m seeing from the major players is that they’re shaving profits in the short term and then rebalancing their portfolios as macro conditions shift. At the same time, they’re aggressively building long-term positions by buying the dip whenever they can. Overall, they’re simply riding the momentum,” he noted.
“On-chain data shows a significant amount of BTC moved from exchanges to cold storage last week alone, signalling confidence in lower levels as entry points. For some of the bigger names like MicroStrategy and JPMorgan, they know exactly how to react to volatility because for them, retail panic is their profit cue.”
However, BTC Markets crypto analyst Rachel Lucas said spot bitcoin ETFs saw up to US$1.8 billion in outflows last week, with BlackRock’s IBIT posting its largest single-day exit, signalling a clear risk-off shift from big money.
“That pressure coincided with bitcoin breaking below US$95,000 for the first time in six months and forming a death cross, a bearish technical pattern that historically signals regime change. We’re now testing US$94,000 support, with a critical floor at US$88,000-US$91,000,” Lucas said.
“Technically, this puts us in a bear market, but context matters, the last cycle saw a 55% drawdown before a run-up to a cycle high in November 2021. We’re likely at the tail end of this bear phase.”
MHC Digital said bitcoin’s long-term role is evolving – and while it still trades like a risk asset in the short term, the firm expects this correlation to break down over time.
“As investors increasingly view bitcoin as a macro store of value and portfolio hedge, it will behave less like a speculative tech stock and more like digital gold.”
“The bottom line is this pullback reflects tight funding conditions and shifting rate expectations, not a break in crypto fundamentals. Once the liquidity cycle turns, we expect digital assets to rebound first, just as they have after every major intervention over the past decade.”
Binance Australia and New Zealand General Manager, Matt Poblocki, said the bigger picture hasn’t changed.
“Institutional participation remains high, and retail investors are taking a more disciplined approach. This kind of response shows a more mature market and one that’s learning to manage volatility with perspective.”
