Key Takeaways
- • Galaxy Research data show SEC 13F filers held 307,000 BTC-equivalent in U.S. spot Bitcoin ETFs as of June 2026, down about 14% from 355,000 BTC on Sept. 30, 2025.
- • Nine named firms, including Millennium Management, Brevan Howard, Goldman Sachs, Capula, Farallon, D.E. Shaw, Schonfeld, Symmetry and Tudor, cut roughly 68,000 BTC-equivalent, about $5.4 billion at current prices, more than the entire 48,000 BTC net decline.
- • The selling was mechanical, driven by the collapse of the cash-and-carry basis trade: the front-month basis fell from 7.9% annualized to 4.8%, only 0.6 points above T-bills, and the strategy now yields about 1.5 points over cash after costs.
- • Roughly 2,200 other reporting institutions were net buyers of about 20,000 BTC (about $1.6 billion), with Morgan Stanley's wealth arm, Mubadala and the Abu Dhabi Investment Council named among accumulators.
- • Non-filer Bitcoin holdings fell only 6.6% while Bitcoin dropped 49%, which Galaxy reads as evidence of strategic rather than momentum holding, though this remains an inference.
Summary
A Galaxy Research report published Monday finds that a small group of hedge funds and banks accounted for more than the entire institutional retreat from U.S. spot Bitcoin exchange-traded funds over the past year, while wealth platforms and sovereign-linked funds took the other side. According to the report, institutions filing quarterly 13F reports with the SEC held 355,000 BTC-equivalent in spot Bitcoin ETFs as of Sept. 30, 2025, shortly before Bitcoin's record high. By June 2026 that total had fallen to 307,000 BTC, a decline of about 14%.
Nine firms drove the decline: Millennium Management, Brevan Howard, Goldman Sachs, Capula Management, Farallon Capital, D.E. Shaw, Schonfeld Strategic Advisors, Symmetry Investments and Tudor Investment. Together they cut 68,000 BTC-equivalent, reducing positions by between 29% and 100%. Because that exceeds the 48,000 BTC aggregate decline, the remaining roughly 2,200 reporting institutions were net buyers of about 20,000 BTC. Galaxy characterizes the selling as mechanical rather than directional, tied to the unwinding of the cash-and-carry trade, in which investors bought spot ETF shares while shorting CME Bitcoin futures to capture the basis. The front-month basis averaged 7.9% annualized in the 30 days before Bitcoin's peak, 3.9 points above three-month T-bills, but averaged 4.8% in the 30 days through Oct. 21. Alex Thorn, Galaxy's head of firmwide research, said, "That arithmetic, not the price, is why the multi-strategy desks left."
Derivatives data corroborate the unwind. CFTC figures show asset managers' net long CME Bitcoin futures fell 57%, from 43,300 BTC to 18,400 BTC, while leveraged funds' net short fell by the same proportion, from 71,400 BTC to 30,600 BTC. Open interest is down 28% in Bitcoin terms and 51% in dollar terms. Thorn argued that the slim forward premium of 6.3% to 6.5% for November and December contracts does not compensate for tail risk, noting the basis inverted to negative 31% annualized in December 2022.
On the buy side, Galaxy identified Morgan Stanley's wealth management arm, Abu Dhabi's Mubadala and the Abu Dhabi Investment Council among institutions absorbing ETF shares, described as long-duration allocators. The report cautions that Form 13F excludes many advisers, family offices and non-U.S. entities, and that sovereign funds operate under disclosure constraints, so the buyer picture is partial. Spot ETF holdings fell 11% from their October 2025 peak to the July trough while Bitcoin fell 53%, and since the June low the funds have added 87,000 BTC. Near-term flows have been volatile, with about $1 billion of outflows over two weeks, a strong day on Oct. 19 led by BlackRock's IBIT, and roughly $286 million of net inflows so far this week. The 13F data does not capture these recent shifts.
Bitcoin traded at $81,398 at the time of writing, with a market capitalization near $1.64 trillion and 24-hour volume of about $25.5 billion. The Fear and Greed Index stood at 51, neutral. The bear case holds that a compressed basis could trigger further arbitrage exits, while the bull case rests on the shift toward longer-horizon holders. Key data points to watch include the 13F filings for the quarter ending September 2026, any disclosure from Mubadala or the Abu Dhabi Investment Council, and the CME basis relative to T-bill yields.
Nine firms drove the decline: Millennium Management, Brevan Howard, Goldman Sachs, Capula Management, Farallon Capital, D.E. Shaw, Schonfeld Strategic Advisors, Symmetry Investments and Tudor Investment. Together they cut 68,000 BTC-equivalent, reducing positions by between 29% and 100%. Because that exceeds the 48,000 BTC aggregate decline, the remaining roughly 2,200 reporting institutions were net buyers of about 20,000 BTC. Galaxy characterizes the selling as mechanical rather than directional, tied to the unwinding of the cash-and-carry trade, in which investors bought spot ETF shares while shorting CME Bitcoin futures to capture the basis. The front-month basis averaged 7.9% annualized in the 30 days before Bitcoin's peak, 3.9 points above three-month T-bills, but averaged 4.8% in the 30 days through Oct. 21. Alex Thorn, Galaxy's head of firmwide research, said, "That arithmetic, not the price, is why the multi-strategy desks left."
Derivatives data corroborate the unwind. CFTC figures show asset managers' net long CME Bitcoin futures fell 57%, from 43,300 BTC to 18,400 BTC, while leveraged funds' net short fell by the same proportion, from 71,400 BTC to 30,600 BTC. Open interest is down 28% in Bitcoin terms and 51% in dollar terms. Thorn argued that the slim forward premium of 6.3% to 6.5% for November and December contracts does not compensate for tail risk, noting the basis inverted to negative 31% annualized in December 2022.
On the buy side, Galaxy identified Morgan Stanley's wealth management arm, Abu Dhabi's Mubadala and the Abu Dhabi Investment Council among institutions absorbing ETF shares, described as long-duration allocators. The report cautions that Form 13F excludes many advisers, family offices and non-U.S. entities, and that sovereign funds operate under disclosure constraints, so the buyer picture is partial. Spot ETF holdings fell 11% from their October 2025 peak to the July trough while Bitcoin fell 53%, and since the June low the funds have added 87,000 BTC. Near-term flows have been volatile, with about $1 billion of outflows over two weeks, a strong day on Oct. 19 led by BlackRock's IBIT, and roughly $286 million of net inflows so far this week. The 13F data does not capture these recent shifts.
Bitcoin traded at $81,398 at the time of writing, with a market capitalization near $1.64 trillion and 24-hour volume of about $25.5 billion. The Fear and Greed Index stood at 51, neutral. The bear case holds that a compressed basis could trigger further arbitrage exits, while the bull case rests on the shift toward longer-horizon holders. Key data points to watch include the 13F filings for the quarter ending September 2026, any disclosure from Mubadala or the Abu Dhabi Investment Council, and the CME basis relative to T-bill yields.
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