The outflows come as bitcoin is bleeding. The digital asset was last trading at $87,907.10— down more than 20% over the past month and off more than 40% from its high of just north of $126,000 hit in early October. That makes November bitcoin’s worst month since June 2022, when the asset’s price fell about 39%.

“There’s no doubt that hot-money investments have had significant outflows,” Jay Hatfield, CEO and portfolio manager at Infrastructure Capital Advisors, told CNBC.

But, “the pullback is really focused on the gambling part of the market … and bitcoin is really the poster child for that,” he said. 

Investors are exiting Blackrock’s fund to rotate into risk-off assets such as gold amid mounting economic uncertainties and signs of souring market sentiment.

A recent survey from the University of Michigan showed that consumer sentiment has nosedived to near record-low levels. Meanwhile, investors are awaiting crucial data from the September retail sales and the producer price index reports, due out on Tuesday. And while the CME FedWatch Tool shows that traders are now pricing in more than 80% odds that the Federal Reserve will slash rates at its December meeting, such a cut remains far from sure bet.

Amid all the uncertainty, bitcoin is bleeding. And, investors in spot bitcoin ETFs, particularly newer holders, are feeling pressure to sell their shares — a reality that could extend the asset’s downside in the near term, Frank Chaparro, head of content and special projects at crypto-focused trading firm GSR, told CNBC. 

“With the macro environment becoming less certain, investors tend to de-risk across assets, which often means trimming exposure to crypto and other risk-sensitive stocks,” Chaparro said. “And for newer entrants who came in through the funds, any downturn can be unsettling – they can sell just as quickly as they bought.”

But while it’s true that spot bitcoin ETFs have brought in hoards of new retail investors who may be flighty during volatile times, the funds have also attracted a range of long-term investors such as institutions who can hold through the downturn, according to Joshua Levine, chairman at bitcoin treasury firm OranjeBTC, told CNBC. 

That institutional base could “dampen some of the extreme downside, but also smooth upside, reducing bitcoin’s volatility as the asset class matures,” Levine said.