Hedge Funds Slashed 68,000 BTC in Bitcoin ETFs as Sovereign Wealth Funds Bought the Dip

A new Galaxy Research analysis reveals a sharp shift in Bitcoin ETF ownership: nine hedge funds and banks collectively cut 68,000 BTC worth of spot ETF exposure as the once-lucrative cash-and-carry trade dried up. The unwind came as futures premiums narrowed, squeezing the low-risk arbitrage that had drawn fast money into the funds. Meanwhile, wealth platforms and sovereign funds stepped in on the other side, absorbing supply and signaling longer-term conviction. The rotation underscores how Bitcoin ETF flows are maturing beyond short-term speculative capital. With institutional giants like sovereign wealth funds increasing stakes, the market may be building a more stable foundation—even as hedge funds retreat.