Bitcoin ETF outflows have slowed, totaling $5.94 billion over six weeks, as market dynamics shift amid rising Treasury yields and inflation concerns.
As traders resume activity following a U.S. holiday weekend, the cryptocurrency market faces new dynamics impacting Bitcoin's value, currently priced at $64,591.65. Notably, Bitcoin spot exchange-traded funds (ETFs) in the U.S. have seen $228 million in redemptions in the latest week, bringing the total outflows to $5.94 billion over six weeks, according to SoSoValue.
However, the pace of these outflows has lessened recently, with a significant drop from previous weeks where withdrawals exceeded $1 billion. Tagus Capital noted that the slowing outflows may indicate a stabilization phase, suggesting that institutional investors are becoming more selective in their strategies.
The firm stated, "Although net inflows remain absent, the slowdown implies that the most intense phase of institutional de-risking is subsiding, allowing for a more balanced flow of funds. This trend could provide a foundation against further downside risks for ETFs."
Another key factor influencing the market is the rising U.S. two-year Treasury yield, which has reached 4.21%, its highest since February 2025, while WTI crude oil prices have declined. This divergence suggests that the market is prioritizing Federal Reserve interest rate expectations over geopolitical concerns related to oil.
Analysts predict that the aftermath of rising oil prices from earlier in the year may continue to fuel inflation, potentially leading to further interest rate hikes. The core PCE, a favored inflation measure by the Fed, is expected to show a monthly increase of 0.37%, raising the annual rate to 3.4%, the highest since May 2024.
In summary, while Bitcoin ETF outflows are slowing down, the combination of rising Treasury yields and ongoing inflation concerns suggests that a significant recovery in Bitcoin's price may not be imminent. Additionally, the actions of Strategy, the largest publicly traded holder of Bitcoin, will be closely monitored as they navigate volatility in their preferred stock.
