U.S. spot Bitcoin ETFs posted net outflows of $228.6 million this week, their second consecutive week of losses, after investors pulled $681.1 million the week before. Roughly $910 million has now left the funds over the past two weeks, leaving October — a stretch many traders dub "Uptober" for Bitcoin's history of strong returns in the month — deep in the red.

Outflows topped inflows on three of the week's five trading days, capped by Friday's net withdrawal of $82.4 million, according to Decrypt's ETF tracker. Data from SoSoValue put the net weekly loss at $228.6 million.

It was a choppy stretch: a $175.7 million inflow on Tuesday was wiped out a day later by $261.4 million in redemptions, the week's worst single session. Thursday managed only a modest $5.1 million inflow before selling resumed on Friday and sealed the week in the red.

Wednesday's selling coincided with a hot inflation print. The consumer price index rose 3.7% year over year in September, coming in above the 3.6% forecast. A hotter-than-expected producer price reading followed on Thursday, reviving speculation that the Federal Reserve could deliver another interest rate hike.

Bitcoin briefly slipped below $80,000 on Thursday, and nearly $950 million in leveraged crypto positions were liquidated over 24 hours, about 90% of them bullish longs, according to data from CoinGlass. The drop also pushed Bitcoin below the average ETF holder's estimated cost basis of around $82,300, Nexo analyst Iliya Kalchev told Decrypt. With Bitcoin trading below that line, the average ETF holder is sitting on paper losses.

The macro backdrop helps explain the persistent selling. When inflation runs hot, the Federal Reserve tends to keep raising interest rates, pushing up Treasury yields and making a nearly risk-free return of around 5% a tough competitor for riskier bets like Bitcoin. Higher rates also make borrowing more expensive and lift the U.S. dollar, squeezing the cheap credit on which leveraged crypto traders depend.

The back-to-back red weeks have pushed the funds' October tally deep into negative territory: after opening the month with roughly $293 million in inflows, they are now down about $615 million for the month, based on Decrypt's tracker. The slide began in earnest on Oct. 7, when a $484.9 million exit marked the funds' worst single day since June. Ethereum and Solana ETFs have also been in the red this month, extending October's weakness beyond Bitcoin products.

Spot Bitcoin ETFs are exchange-traded funds that hold actual Bitcoin rather than derivatives or futures contracts. They trade on stock exchanges like ordinary shares, giving investors exposure to the asset through a regular brokerage account without the need to buy or store it themselves.

Since launching in January 2024, the funds have drawn $57.3 billion in cumulative net inflows, according to Decrypt's tracker, making them a fixture of Wall Street's crypto exposure. Because issuers report their flows daily, and institutions and financial advisers account for much of the money, the figures have become a closely watched gauge of investor sentiment.

Total net assets stand at $104.29 billion, according to SoSoValue, while Decrypt's tracker puts the figure at $100.2 billion. Bitcoin closed Friday near $81,590, down from about $82,337 a week earlier. With issuers reporting flows every trading day, the sessions ahead will show whether the redemption streak extends into a third week — with upcoming inflation readings, and the Fed's response to them, framing the rate backdrop against which this month's selling has played out.