$1.2B Exits from Bitcoin ETFs as Wall Street Continues to Increase Crypto Bets

Bitcoin ETF Outflows Top $1.2B Amid Growing Wall Street Crypto Exposure

Institutions trim positions while market liquidity and off-chain activity support renewed risk-taking

Bitcoin BTC $104,987 ETFs experienced their third-largest weekly outflow on record, even as Wall Street deepens its crypto bets. Last week, $1.2 billion exited Bitcoin funds, accompanied by $508 million from Ethereum ETFs, while Solana products saw $137 million in inflows, according to SoSoValue.

The outflows occurred alongside a market rebound: Bitcoin climbed 4.4% to $106,172, and Ethereum gained 7.2% to $3,617, partially offsetting losses from the U.S. government shutdown and macro uncertainty. Analysts say the drawdowns largely reflect position trimming after strong inflows since early 2024, rather than wholesale capitulation.

Macro Signals Encourage Risk

Liquidity measures, including the SOFR-EFFR spread, have tightened from late-October highs, indicating easing financial conditions. The dollar index (DXY) rally has stalled, and borrowing from the Fed’s standing repo facility has fallen to zero, collectively supporting renewed risk-taking.

Wall Street’s Off-Chain Role

Institutional participation remains robust. BlackRock’s Bitcoin ETF leads inflows, while Fidelity and VanEck continue expanding spot offerings. Much of this exposure occurs off-chain, reflecting cautious adoption of crypto infrastructure that meets Wall Street’s reliability standards.

As Annabelle Huang of Altius Labs noted, ETFs provide institutional access without relying on on-chain systems, leaving liquidity and transparency partially unrealized. Market maker Enflux emphasized the broader evolution: speculative trading is giving way to professional infrastructure and mainstream financial integration.

“When the Fed injects, Bitcoin rallies; when yields twitch, it falls. The dream of decoupling is gone for now, and the market will either professionalize or disappear,” Enflux said.

About The Author

ctleditor

See author's posts