Bitcoin ETF inflows snap losing streak

The inflows totaled $257.7 million, the strongest daily intake since early February 2026, and more than offset Monday’s $203.8 million of net outflows, according to the data cited in the report. The shift came as Bitcoin stabilized after a multi-week slide that has weighed on risk appetite across crypto markets.

The day’s inflows followed five consecutive weeks of net redemptions that together reached about $3.8 billion, reversing what had become a persistent pattern of withdrawals from the 11 US spot Bitcoin ETF products. Even with Tuesday’s rebound, the report described broader sentiment as fragile, pointing to metrics suggesting a large share of the circulating supply is currently held at an unrealized loss.

Fidelity and BlackRock led the day’s buying, according to issuer-level flow data referenced in the report. Fidelity’s spot Bitcoin fund (FBTC) posted nearly $83 million in net inflows, while BlackRock’s iShares Bitcoin Trust (IBIT) followed with about $79 million. Other products were mixed, but the combined total was enough to turn the sector positive on the day.

The inflow print arrived against a backdrop of shrinking headline asset totals across the category. Since the start of 2026, total assets under management across US spot Bitcoin ETFs have dropped 30.5%, falling from about $117 billion to $81.3 billion, according to figures cited in the report. The drawdown reflects both market depreciation and weeks of net redemptions as investors reduced exposure into February’s weakness.

Even so, longer-term cumulative flows remained meaningfully positive. The report said cumulative net inflows were still above $54 billion after peaking above $62 billion in October 2025, suggesting a large share of earlier allocations have remained in place through the recent pullback. The October peak has served as a reference point for how much demand has been absorbed by the ETF wrapper since the products launched.

Alongside the daily flow bounce, new disclosures and analysis highlighted how professional investors adjusted their ETF exposure late last year. The report cited a note from Bloomberg ETF analyst James Seyffart indicating that institutional investors led by advisers and hedge funds sold roughly 25,000 Bitcoin during the fourth quarter of 2025. At current prices referenced in the report, that amount equates to about $1.6 billion—material in ETF terms, but described as small relative to Bitcoin’s overall market capitalization.

After those Q4 reductions, institutions were still estimated to hold about 311,700 BTC, according to Seyffart’s figures referenced in the report. The snapshot adds context to Tuesday’s inflow reversal by showing that, even as some professional holders trimmed positions in late 2025, a sizable base of institutional exposure remains embedded in regulated products.

The report also pointed to a separate strain on sentiment: the scale of underwater supply. Multiple analysts cited in the article estimated that nearly 9 million BTC — about 45% of the circulating supply — was underwater, meaning those coins are held at prices higher than the current market level. That metric can intensify volatility during drawdowns, as rebounds may meet selling from holders seeking to reduce losses, while further declines can trigger additional risk reduction.

Some market participants framed the current phase as part of a longer transition in Bitcoin’s investor base. Bitwise chief investment officer Matt Hougan, quoted in the report, described Bitcoin as moving through stages on the path from speculation toward maturity, arguing that the market cannot move instantly from high speculation to none. The comment was presented as a way to contextualize the coexistence of sharp ETF flow swings and the gradual buildout of long-term holders.

Tuesday’s flows provided a near-term datapoint that demand can reappear quickly when price steadies, but the report’s broader set of indicators showed a market still working through positioning and losses from the recent selloff. With AUM down sharply since the start of the year and a large portion of supply held at a loss, traders will be watching whether ETF inflows persist beyond a single session and whether Bitcoin can hold the mid-$60,000 area without renewed redemptions.