U.S. spot Bitcoin and Ethereum ETFs experienced their largest daily net outflows in two weeks, totaling $582.4 million on Monday, as institutional investors reduced exposure amid equity market volatility and monetary policy uncertainty.
Bitcoin ETFs saw $357.6 million in outflows, the highest single-day redemption since early December.
Ethereum ETFs recorded nearly $225 million in redemptions, marking the biggest daily drop since early in the month.
Overall December flows for Bitcoin ETFs show a net drawdown of $225 million, per data from CoinGlass.
Explore the latest U.S. spot crypto ETFs outflows amid market volatility. Institutional investors cut risk—learn key impacts on Bitcoin and Ethereum. Stay informed on ETF trends today.
What Caused the Recent Outflows in U.S. Spot Bitcoin and Ethereum ETFs?
U.S. spot Bitcoin and Ethereum ETFs faced significant outflows of $582.4 million on Monday, driven by institutional investors reducing risk exposure in response to renewed volatility in U.S. equities and uncertainty surrounding global monetary policy directions. This marked the largest daily net redemptions in roughly two weeks for these funds. Despite crypto prices remaining stable within recent ranges, the ETF flows highlight how allocators are adjusting positions in tandem with broader risk assets like technology stocks.
How Are Institutional Investors Repositioning Amid Equity Market Pressures?
Institutional investors are using spot crypto ETFs as an efficient way to trim exposure during sell-offs in U.S. technology stocks, according to data from Farside Investors. Bitcoin ETFs specifically saw $357.6 million in net outflows, with redemptions spread across funds like Fidelity’s FBTC, Ark’s ARKB, and Bitwise’s BITB, while BlackRock’s IBIT remained flat. Ethereum spot ETFs mirrored this trend with $225 million in outflows, the most substantial since the month’s start. Over the past six months, Bitcoin has underperformed while major U.S. indices held steady, with November marking the asset’s worst month and December showing a prolonged sideways trend lacking sustained demand. Farzam Ehsani, CEO of crypto trading platform VALR, explained that Bitcoin is behaving increasingly like a derivative of the Nasdaq, weakening aggressively when the tech sector corrects. This dynamic has led ETF redemptions to align more with general equity de-risking than crypto-specific issues.
For December to date, U.S. spot Bitcoin ETF activity has been net negative, with $705 million in outflows outweighing $480 million in inflows, resulting in a $225 million drawdown despite some positive inflow days, as tracked by CoinGlass. In contrast, Ethereum spot ETFs have been more balanced, with $411 million in inflows nearly offsetting $403 million in outflows, keeping the segment roughly flat overall.
The broader risk landscape has grown more complex following the U.S. Federal Reserve’s decision on December 10, where rates were cut but signals indicated a potential pause in the easing cycle. Ehsani noted that inflation is not decelerating quickly enough, coupled with internal divisions within the Federal Open Market Committee (FOMC). This uncertainty, combined with tighter financial conditions and pressure on U.S. risk assets, has intensified the environment. The yield on 10-year U.S. Treasury notes climbed to 4.2%, the highest since early September, while technology stocks declined amid renewed concerns over overheating in the artificial intelligence sector.
In this context, crypto markets have struggled to draw consistent participation, even as prices avoided a sharp breakdown. Ehsani remains cautiously optimistic about Bitcoin’s long-term outlook, citing expanding global liquidity from the Fed’s quasi-quantitative easing and accommodative conditions. He also pointed out that selling pressure from long-term holders—a major factor expected in 2025—has largely dissipated. With institutional ETF positions holding firm, these fundamentals could underpin a gradual recovery in demand and help Bitcoin exit its current flat market phase.
Frequently Asked Questions
What Were the Largest Outflows for Bitcoin ETFs in December?
Bitcoin spot ETFs recorded $357.6 million in net outflows on Monday, the biggest single-day redemption since early December, according to Farside Investors data. This pullback occurred across multiple funds as institutions reduced risk amid equity volatility, though some providers like BlackRock saw no change.
Why Are Ethereum ETF Flows More Balanced Than Bitcoin’s This Month?
Ethereum spot ETFs have shown near parity with $411 million in inflows balancing $403 million in outflows through December, per CoinGlass. This stability reflects less aggressive de-risking compared to Bitcoin, which has been more sensitive to tech sector movements and broader monetary policy signals.
Key Takeaways
- Record Outflows Signal Risk Reduction: U.S. spot crypto ETFs lost $582.4 million in a single day, highlighting institutions’ shift away from risk assets amid equity and policy uncertainties.
- Bitcoin Tracks Tech Sector Volatility: As a Nasdaq-like derivative, Bitcoin’s ETF redemptions align with tech sell-offs, per insights from VALR’s CEO, showing broader market correlations.
- Long-Term Optimism Persists: Despite short-term jitters, expanding liquidity and exhausted selling pressure could support a gradual Bitcoin recovery, encouraging sustained institutional interest.
Conclusion
The recent U.S. spot Bitcoin and Ethereum ETFs outflows underscore how institutional investors are navigating a complex landscape of equity volatility and evolving monetary policy uncertainty. While December has brought net drawdowns for Bitcoin funds and balance for Ethereum counterparts, the underlying institutional foundation remains robust. As global liquidity expands and key selling pressures ease, these trends may pave the way for renewed demand—investors should monitor Federal Reserve signals closely for potential shifts in crypto exposure.