NYDIG: Crypto Capital Flight Evident Amid ETF Outflows, Stablecoin Activity, and DAT Reversals.

NYDIG: ETF Outflows, Stablecoins, and DAT Reversals Signal Crypto Capital Flight

Spot bitcoin ETFs have experienced persistent outflows, totaling $3.55 billion in November, while stablecoin supply has also declined—both signs that capital is exiting the crypto market, according to NYDIG.

Greg Cipolaro, Global Head of Research at NYDIG, said bitcoin’s slide to $84,000 is driven more by market mechanics than investor sentiment. In a recent report, he noted that the primary engines of the 2024–25 rally have shifted into reverse.

ETF Outflows Intensify
Spot bitcoin ETFs, which were a major source of demand earlier this year, are now seeing steady redemptions. These funds had injected billions into bitcoin in the first half of 2025, but recent five-day flow data show a reversal. SoSoValue reports that November’s outflows could become the largest monthly withdrawal since these ETFs launched, approaching the $3.56 billion record seen in February.

Stablecoins Show Capital Exodus
Stablecoins are sending a similar signal. Total supply has declined for the first time in months, while the algorithmic USDE token has lost nearly half its supply since the October 10 liquidation event. Cipolaro noted that this reflects funds leaving the market rather than simply moving to the sidelines.

“USDE’s rapid contraction, falling to $0.65 on Binance, underscores how aggressively capital has been withdrawn from the system,” he wrote.

DAT Reversals Add Pressure
Corporate treasury strategies tied to DAT share premiums have also shifted. As premiums turned to discounts, companies that previously issued stock to buy bitcoin are now selling assets or repurchasing shares. Sequans, for example, sold BTC earlier this month to reduce debt.

“While these reversals mark a shift from a strong demand engine to a potential headwind, no DAT has shown signs of financial distress,” Cipolaro emphasized. “Leverage remains modest, interest obligations are manageable, and many structures allow issuers to suspend dividends or coupons if needed.”

Large Purchases Fail to Stabilize Price
Even major purchases, including those by Strategy and El Salvador, failed to halt bitcoin’s decline. Cipolaro said this indicates that the market is now dominated by structural forces rather than sentiment. He pointed to the $19 billion liquidation on October 10 as a catalyst, creating a feedback loop where mechanisms that previously drove prices higher now reinforce declines.

Investor Outlook
Cipolaro advised investors to “hope for the best, but prepare for the worst.” While the long-term case for bitcoin remains intact, near-term conditions are likely to follow familiar cyclical patterns.

“History suggests volatility ahead, but long-term conviction remains essential for investors,” he added.