Shares slid as IBIT fell $1.15 to $35.62, tracking a broader crypto selloff on the first day of the Federal Reserve's two-day meeting. Bitcoin itself dropped roughly 2.5% to around $63,300 , pressured by a triple threat: new Section 301 tariffs on imports from 60 economies that took effect July 24, adding 10–12.5% duties on top of existing levies ; a Fed meeting some analysts call the hardest to predict in years, with rate-hike odds jumping to 35.8% from 25.7% a week earlier ; and more than $465 million in spot Bitcoin ETF outflows on July 23–24 that snapped a seven-session inflow streak . For IBIT holders, the question is whether a nascent recovery just died.
A Brief Calm Shattered by Fresh Selling
U.S. spot Bitcoin ETFs had strung together nearly $1 billion in inflows over seven straight sessions, with BlackRock's IBIT capturing $319 million of that total.
But outflows re-emerged by July 24, and year-to-date net outflows remain in the range of $5.4–$5.8 billion. That deficit matters because ETF flows now account for roughly 45% of weekly Bitcoin price moves , making IBIT both a barometer and an amplifier of institutional sentiment.
Tariffs Are Feeding the Inflation Fear That Keeps the Fed Hawkish
Trade-exposed sectors face cost pressures as new tariffs layer on top of rising energy prices , and Fed minutes have tied elevated inflation to AI-related demand, tariffs, and Middle East energy costs . Higher inflation keeps rate cuts — the catalyst Bitcoin bulls need — off the table. The federal funds rate sits at 3.5–3.75%, and prediction markets have priced a hold at 82–93% probability, but hike odds have risen sharply. Any hawkish language from Chair Warsh on Wednesday could trigger another wave of selling.
The Year's Outflow Hole Is Still Deep
A total of $4.51 billion was pulled from Bitcoin ETFs in June alone, and July has recovered only about 15% of that damage.
IBIT peaked near $90 billion in assets in May before three outflow waves dragged it below $45 billion. Even with cumulative net inflows of roughly $60 billion since IBIT's January 2024 launch , the 2026 trajectory tells a story of institutional rotation — capital has been consistently shifting toward AI-related assets this year .
What Comes Next Hinges on One Afternoon Wednesday's 2 p.m. policy statement will set the tone. Warsh's press conference will reveal whether this hold is dovish, neutral, or a setup for a September hike . Until then, IBIT shareholders are essentially betting that the worst of the macro storm is already priced in — a bet that has repeatedly cost them money in 2026.