Hedge funds significantly reduced their Bitcoin ETF holdings by 28% in the fourth quarter of 2025, according to data from CF Benchmarks. This marks a rapid withdrawal from the U.S. Bitcoin ETF market, which had previously seen substantial hedge fund interest. The de-risking trend was highlighted by Gabe Selby, Head of Research at CF Benchmarks, who noted that the October spike and subsequent decline in Bitcoin prices triggered systematic unwinding. Brevan Howard emerged as the largest seller, drastically cutting its position in BlackRock’s iShares Bitcoin Trust by 86%, from $2.4 billion to $275 million. This move reflects broader concerns as Bitcoin's role as a hedge against inflation and market stress was questioned amid falling prices and macroeconomic risks.