Bitcoin exchange-traded funds (ETFs) on bitcoin recorded the longest period of fund outflows since their launch in early 2024. Although this coincided with the main cryptocurrency’s price falling by more than 20%, experts cautioned that the market may misinterpret outflows as a loss of institutional interest. However, there is virtually no positive sentiment regarding the crypto market’s near-term outlook.

American spot ETFs became one of the main sources of institutional capital inflow into the crypto market after their launch in 2024. When investors buy shares of such funds, the asset managers purchase the corresponding amount of bitcoin to back them. This creates demand in the market. When shares are redeemed and capital flows out of the funds, the reverse process occurs—bitcoins from their backing are sold, creating additional pressure on the market price.