Bitcoin, Ethereum ETFs see $9bn of net outflows over four months as institutional demand cools sharply

Bitcoin and Ethereum spot exchange-traded funds (ETFs) listed in the US have seen $9bn leave over the past four months, according to data. Analysts say the bearish market trend is becoming entrenched as institutional investor demand contracts rapidly.

According to CoinDesk, a crypto-focused media outlet, US-listed Bitcoin spot ETFs posted net outflows for four consecutive months, with total redemptions reaching $6.39bn. This marks the longest streak of monthly net outflows since the ETFs were launched in January 2024, based on figures compiled by data provider SosoValue.

Ethereum spot ETFs also recorded $2.76bn in outflows over the same period, indicating a sharp deterioration in investor sentiment.

The scale of these outflows is seen as evidence that institutional appetite for digital assets has weakened markedly. Bitcoin, after setting a peak in early October last year above $126,000, has fallen by roughly half to around $67,000. Ethereum has declined by more than 60% since topping $4,950 in August last year.

Since their early-2024 debut, spot ETFs have become the most visible conduit for institutional inflows. In particular, a surge of capital over several months following Donald Trump’s victory in the US presidential election—on a pro-crypto platform—helped drive a bull market.

Demand, however, cooled quickly after the sharp drop in early October last year. That sell-off was previously attributed to price dislocations on the offshore exchange Binance. While intermittent inflows have appeared recently, analysts said a sustained shift back to net inflows is needed for a meaningful rebound.

The outlet reported that “a spike in global oil prices and rising geopolitical tensions in the Middle East are adding further pressure to crypto markets.” Bitcoin gave back gains after a weekend bounce, retreating to around $66,700, while oil jumped 6% to $77 a barrel. Asian equities fell 1.4%.

Meanwhile, markets are raising the possibility that if escalating tensions between the US and Iran—and the fallout from any disruption in the Strait of Hormuz—stoke inflation concerns, the timing of rate cuts by the Federal Reserve (Fed) could be pushed back. Some traders, however, believe that if disruptions to crude supply remain limited, downside pressure on crypto assets may also be contained.