Bitcoin, Ethereum ETFs Break Eight-Week Outflow Streak
Digital asset funds recorded their first weekly inflows since May, offering a tentative signal that institutional investors may be returning to the sector after a prolonged, multi-billion-dollar selloff.
Cryptocurrency exchange-traded funds attracted $281.8 million last week, halting an eight-week run of outflows that drained more than $7 billion from the sector. According to Deutsche Bank, this marked the first week of positive flows since early May. Bitcoin funds accounted for the bulk of the demand with $197.4 million, while ethereum funds brought in $84.4 million.
The return of capital provides a measure of relief for a market that has contracted sharply this year. Bitcoin is down 29% year to date as investors recalibrate valuations that were initially inflated by rapid institutional adoption and optimism surrounding digital asset policy. Higher-for-longer interest rates have further dampened the appeal of speculative allocations, prompting systematic profit-taking following the sector's historic multiyear rally.
Beyond macroeconomic pressures, the industry is currently grappling with deeper questions about its fundamental utility. Market professionals are increasingly scrutinizing whether digital assets can actually secure sustainable, real-world use cases beyond pure trading and speculation. Compounding this cautious stance is persistent regulatory uncertainty in major global markets, which has frequently injected sharp volatility into token prices and kept some institutional buyers on the sidelines.
Despite the broader turbulence, many long-term investors continue to view the recent weakness as a necessary consolidation rather than a structural breakdown. "Bottom line, any crypto correction is painful, but this one has been rather comforting. Crypto feels like it's growing up," said Gautam Chhugani, a digital assets analyst at Bernstein. Chhugani noted that while the firm's 2026 year-end Bitcoin price target of $150,000 appears ambitious given the current market correction, the firm expects the cycle to ultimately turn and continues to monitor fund flows for confirmation.
Top industry executives share this view that the drawdown is temporary. "If you just look at the past trends in bitcoin, I think we bottomed at $60K or so. A lot of things could drive growth of bitcoin here," Coinbase co-founder and CEO Brian Armstrong said. Armstrong pointed to advancing market structure and legislation as positive catalysts, alongside a potential rotation of risk capital. He suggested that once heavily funded artificial intelligence companies complete their public listings and the unlocks happen, capital will move back around.
