In a bold prediction, Eric Jackson, founder of EMJ Capital, asserts that the ongoing sell-off in Bitcoin (BTC) exchange-traded funds (ETFs) is not a sign of failure but a ‘purification’ of the asset’s long-term bull case. Jackson argues that the current institutional exodus will pave the way for a new wave of long-term investors, including sovereign wealth funds and corporate treasuries, who will hold BTC for decades, not quarters.
“BTC didn’t fail as an asset. It succeeded as an ETF. And that’s the problem,” Jackson summarized in an X post on Tuesday. The U.S. spot Bitcoin ETFs have seen consistent net outflows, exacerbating the bearish trend that began in October 2025. Jackson points out that BTC has become a ‘high-beta tech position’ due to its strong correlation with tech stocks, particularly the BlackRock iShares Expanded Tech-Software Sector ETF (IGV).
From ETFs to Long-Term Institutional Holders
Bitcoin’s price has been heavily influenced by institutional ETFs, with the iShares Bitcoin Trust (IBIT) being a significant player. Jackson notes that BTC’s price movements now closely mirror those of the IGV, which is not a characteristic of a store of value. “From $126K to $63K. Every time IGV sells off, BTC sells off with it. That’s not a store of value. That’s a high-beta tech position with a different logo,” he explained.
The current institutional exit is seen as a cycle of filtering out weaker hands, much like in previous cycles. “2017: retail sold at $20K. 2021: funds sold at $69K. 2025: ETF allocators are selling at $63K,” Jackson observed. This pattern suggests that each cycle sees a shift in the marginal buyer, with retail investors and funds giving way to longer-term institutional holders.
Looking Beyond the Current Exodus
According to Jackson, the future of Bitcoin lies in the hands of institutional investors who are less likely to be swayed by short-term market fluctuations. “What comes next? Sovereign wealth funds. Corporate treasuries. Pension capital. Money that doesn’t rebalance into quarters. Money that doesn’t correlate to IGV. Money that holds for decades, not cycles,” he forecast.
For Bitcoin to regain its status as a store of value, Jackson believes that the recovery of stablecoin supply on exchanges and the end of sell pressure from tech ETFs like IGV are crucial. These factors, combined with the entry of more stable and long-term institutional capital, could potentially reverse the current bearish trend and set the stage for a new bull cycle.
The Bearish Trend and Forward-Looking Insights
Despite the current bearish sentiment, Jackson remains optimistic about Bitcoin’s long-term prospects. He emphasizes that every cycle filters out the weak hands, making way for more robust and committed investors. The latest data from Farside Investors shows that Monday’s net Bitcoin ETF outflows amounted to just over $200 million, contributing to BTC/USD dipping below $63,000 on Tuesday.
“The institutional exit isn’t the end of the BTC thesis. It’s the purification of it,” Jackson concluded. As market participants set new macro bottom targets near the $50,000 mark, the future of Bitcoin remains uncertain but ripe with potential for those willing to hold for the long term.
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