BlackRock's Bitcoin ETF Is $13 Billion Underwater

BlackRock’s iBit Bitcoin ETF was estimated to be about $13 billion underwater on net flows, making it the weakest-performing spot Bitcoin ETF in David Canales’s analysis. He estimates iBit’s average Bitcoin acquisition cost at roughly $79,500, compared with a market price near $62,000 at the time. The figure is an approximate flow-based profit-and-loss estimate, not the ETF’s share-price performance; the exact purchase prices are difficult to establish. Canales initially put iBit’s losses at about $15–16 billion before revising the estimate to roughly $13 billion.

Calling this “BlackRock selling” is convenient shorthand, Canales says, but ETF outflows mean investors are selling shares and do not necessarily indicate that BlackRock has decided to sell Bitcoin. At Bitcoin’s bull-market peak, his estimate put iBit about $30 billion in profit. Most shareholders did not take profits, and many bought near the market top, leaving the fund’s net-flow estimate deeply negative as prices fell. By contrast, Fidelity’s FBTC had an estimated average Bitcoin cost of about $55,350 and was down roughly $1.5 billion at the time, after reaching an estimated peak profit of about $14 billion. Canales attributes part of FBTC’s lower estimated cost to substantial shareholder profit-taking in December 2024.

Canales warns that another Bitcoin decline, if ETF holders still do not capitulate, could put more pressure on underwater investors and accelerate outflows. He frames capitulation as a typical feature of bear-market endings: a major decline gives way to slower accumulation and consolidation before a subsequent bull market. The scale of the current estimated losses does not establish that investors will sell, but ETF-holder behavior is a potential source of further selling pressure if prices fall.

Every ETH ETF was estimated to be underwater on net flows. BlackRock’s ETH-A was both the largest and the most deeply underwater, with an estimated $6.4 billion loss on accumulated flows and an average ETH cost near $3,900, against a market price around $1,600. The speakers described its remaining shareholders as nearly 60% down on net flows, while cautioning that fund-level estimates do not mean every individual ETH-A shareholder is losing money. Fidelity’s F-ETH was about 18% down, and other ETH ETFs were near breakeven or only slightly underwater.

Most ETH-A inflows came during ETH’s sharp rally alongside Bitcoin in mid-2025, and relatively little profit-taking took place near the peak. The speakers say larger ETF investors overall have not timed the market well and identify ETF holders as an important cohort to watch over the next six months, with selling at a loss a possibility rather than a certainty. They also argue that ETFs and digital-asset treasury companies now occupy a role in crypto markets comparable to, or greater than, the role miners and validators played in earlier cycles.

The discussion of crypto pre-IPO markets was more tentative: the speakers described them as a small proof of concept for price discovery, not a way to acquire shares, because the products are cash-settled perpetuals. SpaceX was offering IPO shares at $135 without first setting a price range; reported pre-IPO shares were at $138, while a Jupiter terminal showed a $154 mark that might need updating. SpaceX’s pre-IPO tokens had a reported $6 million market cap and about 11,000 holders, up from 6,600 on May 10. Across pre-IPO tokens, the reported market cap was $22 million, with SpaceX at about 28%, Anthropic at 38%, and OpenAI at 12%.

The speakers said 50,000 holders would indicate a material pre-IPO market, putting SpaceX at about one-fifth of that benchmark. They noted that typical retail IPO allocations are about 5–10%, whereas SpaceX is seeking to direct roughly 20–35% of shares to retail. That larger allocation could reduce demand for crypto-based pre-IPO access and makes its eventual market impact harder to assess. One speaker expected OpenAI to go public later in the year and identified Anthropic as the next pre-IPO market to watch, potentially overtaking SpaceX if its IPO favors investment banks over retail.