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Bitcoin has shed roughly 25% year-to-date, and Bitwise Bitcoin ETF (NYSEARCA:BITB) has tracked that decline nearly tick for tick – that is by design. BITB holds physical Bitcoin and charges a low 0.20% annual expense ratio, so its NAV moves in lockstep with spot price. That simplicity cuts both ways: with Bitcoin near $68,400 and still well off its January 2026 highs, the question for the next 12 months is what drives the next major move.
Macro Factor: Bitcoin Price and U.S. Regulatory Momentum
BITB has no bonds, no dividends, no earnings. Its entire return is Bitcoin’s return. The single macro factor that matters most is the evolving U.S. regulatory and institutional framework around Bitcoin. The SEC’s approval of spot Bitcoin ETFs in January 2024 was the pivotal unlock, but what comes next (additional institutional adoption, clearer crypto tax treatment, or potential strategic reserve policy) will determine whether Bitcoin reclaims its January 2026 highs above $87,000 or continues lower. Prediction markets assign only a 38.5% probability to Bitcoin reaching $100,000 by year-end, while a 76% probability is priced on Bitcoin dipping to $55,000 at some point in 2026. That asymmetry reflects real uncertainty.
The most actionable signal to watch is the Federal Reserve’s rate posture alongside Congressional crypto legislation. Lower rates historically reduce the opportunity cost of holding non-yielding assets like Bitcoin. Monitor the Fed’s dot plot at each FOMC meeting and any legislative updates through the House Financial Services Committee.
Broader Bitcoin sentiment has turned cautious. An r/stocks discussion on a major Bitcoin-related equity noted it was “Down More Than 60% From Its High,” capturing the mood among retail investors tracking the space.
Micro Factor: AUM Growth and Liquidity Depth
BITB has grown to approximately $3.2 billion in assets under management since its January 10, 2024 launch, but it remains smaller than iShares Bitcoin Trust (NASDAQ:IBIT). That gap matters: larger AUM means tighter bid-ask spreads and more reliable intraday pricing, reducing hidden friction costs. As Bitcoin’s volatility continues, the February 5-6 selloff saw volume spike to nearly 50,000 BTC in a single day, and funds with thinner liquidity can trade at wider spreads during stress periods. Watch Bitwise’s monthly AUM disclosures and daily volume data. Consistent net inflows during Bitcoin drawdowns signal growing investor conviction; declining AUM during prolonged weakness would be the warning sign.
Bottom Line
U.S. regulatory clarity and Fed rate policy remain the key macro variables for Bitcoin price direction. Monthly AUM disclosures and daily volume data offer insight into whether institutional and retail flows into spot Bitcoin ETFs are holding steady or reversing during this drawdown period.