Exchange-traded ETFs attract $1.42B: When institutional players return to the market

Spot Bitcoin funds registered in the US are showing the strongest capital inflows since the beginning of October. Over the past week, these regulated investment instruments attracted $1.42 billion in net inflows — the largest figure in over three months. This data signals a return of large institutional players, while selling pressure from major digital asset holders has noticeably weakened.

Accelerating Exchange-Traded Funds: When Demand Spiked Midweek

Data from the analytical platform SoSoValue show a sharp increase in demand in the middle of the workweek. It was during this period that the most significant capital inflows occurred: Wednesday brought the largest one-time influx of about $844 million, and Tuesday ended with $754 million in net inflows.

Although the end of the week tempered some expectations — Friday recorded withdrawals of approximately $395 million — the overall dynamics remained positive. The strong midweek demand proved sufficient to reach the highest weekly result since December, when funds attracted about $2.7 billion in capital.

Ether Follows: Similar but More Moderate Dynamics

Spot Ether ETFs show a similar, yet less intense picture. Tuesday saw an inflow of $290 million, Wednesday — $215 million in net inflows. Unfortunately, sales at the end of the period reduced the overall figures: Friday ended with withdrawals of about $180 million.

Result: weekly inflows of Ether ETFs amounted to approximately $479 million. While the figure is positive, it indicates a more cautious attitude among investors toward the “second-largest” crypto asset compared to Bitcoin.

Market Turnaround: The Mechanism of Strong Institutional Supply

Vincent Liu, head of investment at Kronos Research, provides a deep explanation of the observed changes. In his assessment, the data indicate a gradual return of large institutional players with long-term positions.

“ETF inflows demonstrate that big investors are returning through official, regulated channels,” Liu explained in a conversation with Cointelegraph. He noted that blockchain analytics show a decrease in selling volumes from whales (large holders) compared to the end of December, which weakens the main source of market pressure.

“Absorption of ETFs combined with stabilization of whale activity suggests a tightening of effective cryptocurrency supply and increased market risk,” added the expert. Against the backdrop of a decreasing number of large distributors and continuous absorption of spot supply by ETFs, the available Bitcoin liquidity appears increasingly constrained — even amid high price volatility.

Signal or Trade? Early Signs, Not Final Confirmation

Despite positive indicators, Liu considers a realistic scenario. “These are still early stages of transformation, not a full confirmation of a new trend,” he warned. However, the combination of sustained ETF inflows, weakened whale activity, and improved market structure hints at the formation of a more stable institutional supply.

“The probabilities point to more green days, although the trend will remain turbulent,” Liu clarified. “ETFs provide a structural foundation for supply, and the reduction in whale activity suggests that associated dips are likely to be quickly absorbed by demand.”

Sustainability Question: Are Inflows Sufficient for Continued Growth?

Not all market participants are confident that ETF inflows are enough to sustain a long-term upward trend. A macroeconomic analysis of Bitcoin dynamics conducted by Ecoinometrics found an interesting pattern: recent ETF inflow peaks often triggered only short-term price recoveries rather than sustained bullish rallies.

Ecoinometrics analysts note that positive inflow days can stabilize the price, but Bitcoin usually needs several consecutive weeks of strong institutional demand to significantly change the broader trend. Historical data show that when inflows to exchange funds slow down, price pressure often reemerges. Therefore, sequence and stability, rather than isolated activity spikes, remain crucial for genuine position recovery.