Extended Crypto ETF Outflows Signal Institutional Disengagement: Insights from Glassnode

Recent data suggests that institutional investors are pulling back from cryptocurrencies, as highlighted by extended outflows from Bitcoin and Ether exchange-traded funds (ETFs). This trend may indicate a concerning shift in market sentiment.

Key Takeaways

Institutional Disengagement: Glassnode reports a steady decline in net inflows into Bitcoin and Ether ETFs since early November.
Market Sentiment Shift: The downturn in ETF flows reflects a bearish sentiment among institutional investors amid broader market contractions.
Selling Pressure: Crypto ETFs have faced significant selling pressure, with substantial outflows reported in recent weeks, despite some inflows into specific funds like BlackRock’s iShares Bitcoin Trust.
Comparative Performance: BlackRock’s Bitcoin ETF has outperformed rivals, even surpassing inflows of the popular SPDR Gold Shares fund.

Extended crypto ETF outflows shows institutions disengaging: Glassnode

The Current Landscape of Crypto ETFs

According to the analytics platform Glassnode, Bitcoin and Ether ETFs have experienced a period of persistent outflows, marking a clear disengagement by institutional investors. Since early November, the 30-day simple moving average of net flows into US spot Bitcoin and Ether ETFs has been negative. This situation has been interpreted as a sign of reduced participation and partial withdrawal by institutional allocators, contributing to a broader trend of liquidity contraction in the cryptocurrency market.

Ethereum ETF, Bitcoin ETF
Source: Glassnode

A Return of Selling Pressure in Crypto ETFs

Data from Coinglass indicates that Bitcoin ETF flows have been negative for the past four trading days. Despite this, BlackRock’s iShares Bitcoin Trust (IBIT) has seen small inflows recently. The Kobeissi Letter highlighted the resurgence of selling pressure in crypto ETFs, reporting that these funds experienced $952 million in outflows last week, with investors withdrawing capital in six out of the last ten weeks.

Related: BlackRock Pins Bitcoin ETF as Major Theme Alongside T-Bills, Tech Stocks

Despite the recent challenges, BlackRock's fund remains the frontrunner in the industry, with $62.5 billion in inflows since its launch, outperforming all competing Bitcoin ETFs.

IBIT's Competitive Edge

Bloomberg ETF analyst Eric Balchunas noted that IBIT is the only ETF on Bloomberg’s “2025 Flow Leaderboard” that shows a negative return for the year but still ranks sixth overall. He pointed out that the BlackRock Bitcoin ETF has attracted more funds than the SPDR Gold Shares fund (GLD), which has posted a 64% increase.

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