Weekly outflows from spot Bitcoin ETFs accelerate, clearly reflecting institutional investors' risk aversion

The current outflow phase from the U.S. spot Bitcoin ETFs is more than just a short-term correction; it has become a symbol of worsening market sentiment overall. With weekly outflows continuing for five consecutive weeks, understanding the underlying factors and market mechanisms is crucial for shaping future investment strategies.

$3.8 Billion Withdrawn, Weekly Selling Pressure Continues

According to data from SoSoValue, fund outflows from spot Bitcoin ETFs are accelerating steadily. Last week alone, approximately $315.9 million was net withdrawn, bringing the total outflow over the past five weeks to about $3.8 billion.

Of particular note is the scale of withdrawals during the week ending January 30. The outflow reached about $1.49 billion, making it one of the largest in the recent outflow episodes. Looking at weekly figures, on February 12, over $410 million was recorded as outflow, indicating that intense selling on specific days is influencing the overall weekly trend.

Limited Buying Demand Cannot Counter Large Redemptions

While the overall trend is bearish, there are some buying pressures during trading sessions. On Friday, about $88 million flowed into physical Bitcoin ETFs. However, this limited buying demand was not enough to offset the large-scale redemptions recorded from early to mid-week.

Additional negative flows were observed from February 17 to 19, and although there was intermittent buying interest during the week, the net result was still a net outflow. This imbalance in flows vividly reflects market participants’ psychological state.

Short-term Position Adjustments and Institutional Investor Sentiment

Market analysis increasingly suggests that this persistent outflow should not be viewed merely as a retreat from long-term conviction. Instead, it is seen as institutional investors adjusting their portfolios temporarily in response to current macroeconomic conditions and geopolitical uncertainties.

Vincent Liu, Chief Investment Officer at Cronos Research, points out that escalating trade conflicts and tariff-related policy developments are reinforcing risk-avoidance attitudes across global markets. Digital assets, especially major cryptocurrencies like Bitcoin and Ethereum, are highly sensitive to these macroeconomic shifts.

Geopolitical Tensions and Macro Uncertainty Drive Selling Pressure

At the core of the current outflow phase is investor sentiment. Labor market data, such as U.S. initial unemployment claims, serve as key indicators for predicting economic trends. Weakening labor statistics could trigger expectations of rate cuts by the Federal Reserve, potentially improving sentiment toward cryptocurrencies.

Meanwhile, the Crypto Fear & Greed Index remains in extreme fear territory, indicating that the market is still in an overly risk-averse mode. Until this psychological tension eases, outflows from ETFs are unlikely to stop.

Similar Selling Pressure Spreads to Ethereum ETFs

The selling pressure is not limited to Bitcoin. Ethereum spot ETFs have also experienced five consecutive weeks of net outflows. Last week alone, about $123.4 million flowed out of Ethereum ETFs.

Individual outflow days include February 17, with $48.6 million, and February 13, with $10.3 million, among others. However, inflows to offset these outflows are limited. The reduction in exposure to the second-largest crypto asset further indicates that institutional risk aversion is widespread.

$54 Billion in Cumulative Inflows Signaling Long-term Adoption

Looking at the long-term perspective, since the listing of U.S. spot Bitcoin ETFs, the total net inflow has reached approximately $54.01 billion, with current total assets around $85.31 billion. This amount, representing about 6.3% of Bitcoin’s total market capitalization, suggests that institutional adoption of cryptocurrencies is an irreversible trend.

The recent weekly outflows are merely short-term adjustments within this massive asset base and do not negate the structural trend of institutional participation.

Rate Policy Shifts as a Condition for Flow Reversal

The persistence of ETF outflows highlights how closely crypto investment products are tied to macro factors such as interest rate expectations, employment data, and geopolitical risk assessments.

Analysts generally agree that for flows to stabilize or turn positive, the market needs to receive clear signals of monetary easing and renewed confidence in the Federal Reserve’s policy direction. Until then, weekly flow volatility is expected to continue, though long-term institutional participation is likely to be maintained.