Bitcoin is trading below the average cost basis of US spot Bitcoin ETFs after they recorded their second and third-biggest outflow weeks last month, according to Galaxy’s head of research, Alex Thorn.

The total assets under management for US Bitcoin ETF products are approximately $113 billion, according to Coinglass, and they collectively hold around 1.28 million BTC, according to BiTBO, implying an average cost basis of about $87,830 per Bitcoin.

Meanwhile, Bitcoin fell about 11% from $84,000 on Saturday to a nine-month low near $74,600 in early trading on Monday.

“This means the average Bitcoin ETF purchase is underwater,” said Thorn. 

The eleven spot BTC ETFs saw $2.8 billion in outflows over the past fortnight, which includes $1.49 billion last week and $1.32 billion the week before, according to CoinGlass.

Institutional investors have tougher hands

Total assets under management for spot Bitcoin ETFs in the US have declined by 31.5% since their October peak of $165 billion, while spot BTC is down 40%.

“They’ve [institutional investors] been hodling,” said Thorn, who added that ETF cumulative inflow is only down 12% from its peak while Bitcoin is down 38%.

Dwindling demand sparks bear market fears 

Nick Ruck, director at LVRG Research, warned that Bitcoin might fall into a fully-fledged bear market if recovery doesn’t come soon. 

“The crypto market continues its sell-off as Bitcoin falls to around $76,000 amid heightened macro uncertainty, while the proposed US CLARITY Act stalls,” he told Cointelegraph. 

“Despite Trump’s crypto-friendly pick for the next Fed chair, investors are de-risking due to continuous geopolitical conflicts and dollar instability as the US economy struggles between rising unemployment and inflation,” he continued. 

“BTC may enter into a bear market if it continues to drop further, as technical indicators showcase long-term sell pressure patterns forming if demand doesn't recover soon.”