Bitcoin fell 53% from its ATH, yet US spot ETF holdings declined just 11%. Who was selling? Meanwhile, CME asset managers’ net longs and leveraged funds’ net shorts both fell 57% as basis trade returns compressed. @intangiblecoins’ research connects these shifts to a potential change in Bitcoin’s institutional ownership, and argues the bear market likely ended in June. Basis returns fell from 7.9% near the ATH to 4.8% now, barely above T-bills. The shrinking premium made cash-and-carry trades less attractive. CME positioning contracted sharply: - Asset managers’ net longs: 43.3K → 18.4K $BTC (-57%). - Leveraged funds’ net shorts: 71.4K → 30.6K $BTC (-57%). - Futures open interest: down 51% in dollar terms from the October 2025 high. @galaxyhq notes that much of leveraged funds’ short exposure reflected cash-and-carry trades, not outright bearish bets. Since Bitcoin’s June low, US spot ETFs have added approximately 87,000 BTC, suggesting renewed demand despite the broader sell-off. Nine multi-strategy and macro funds cut 68K BTC-equivalent in ETF exposure, exceeding the 48K net decline across reporting institutions. Other institutions, including wealth platforms and sovereign investors, collectively added exposure, suggesting ownership rotated between investor groups. The positioning reset changes the market’s demand mix: - Less capital tied to basis trades. - Greater dependence on directional spot demand. Key signals to watch: - ETF holdings rise, indicating sustained demand. - Spot demand strengthens while futures open interest stays subdued. - ETF holdings fall below 1.22M BTC, Galaxy’s stated invalidation threshold. - Basis returns recover, potentially reviving cash-and-carry trades. Bitcoin’s next phase depends on whether directional demand can absorb the supply left behind by exiting basis traders. If spot buying persists as arbitrage incentives fade, the reset becomes constructive. Without it, lower speculative positioning is not enough.