Bitcoin ETF Outflows Continue as Institutional Crypto Participation Shows Signs of Retreat

Extended Outflow Streak Hits Bitcoin ETFs

US spot Bitcoin exchange-traded funds are experiencing a four-day negative flows streak, with investors withdrawing $188.6 million from the products in the latest trading session, according to data from Farside Investors ^[2]. The sustained outflows come as cryptocurrency markets continue to retrace from earlier highs.

Despite the overall negative trend, BlackRock's IBIT has managed to record some inflows during the streak. The fund saw $32.8 million in capital inflows on December 18 and another $6 million on December 22, even as it suffered outflows of $157.3 million and $173.6 million on other days during the period ^[2]. Fidelity's FBTC was the only other fund to record net inflows during the streak, adding $15.3 million on December 19 ^[2].

Ethereum Products Resume Outflows

Ethereum ETFs have returned to negative territory after briefly breaking a multi-day losing streak. Investors withdrew $95.5 million from the products during yesterday's trading session ^[2]. This followed a single day of respite when the funds saw net daily inflows of $84.6 million, which had temporarily ended an outflow streak that began on December 11 and lasted through December 19 ^[2].

During that earlier period, $705.6 million exited the US spot ETH ETFs, with much of the outflows coming from BlackRock's ETHA product ^[2].

Glassnode Flags Muted Institutional Participation

Analytics firm Glassnode has characterized the ongoing outflows from spot Bitcoin and Ethereum ETFs as indicative of an institutional retreat from cryptocurrency markets ^[2]. The assessment comes as more than 190 publicly traded companies now hold Bitcoin on their balance sheets, continuing the trend of institutional Bitcoin adoption that accelerated after spot Bitcoin ETFs launched in the US last year ^[1].

However, many companies that adopted Bitcoin buying strategies have seen their share prices slide as crypto markets retraced and initial hype faded, prompting some analysts to question the long-term sustainability of Bitcoin treasury strategies ^[1].

Corporate Bitcoin Holdings Under Pressure

Some corporate Bitcoin holders have begun selling portions of their reserves to meet balance-sheet obligations amid tightening market conditions ^[1]. Chip maker Sequans sold 970 BTC in early November to redeem outstanding convertible debt, backsliding on its goal to accumulate 100,000 BTC over the next five years ^[1].

Matador Technologies Expands Bitcoin Treasury Plans

Despite market headwinds, some companies continue to pursue aggressive Bitcoin accumulation strategies. Bitcoin financial services firm Matador Technologies received regulatory approval from the Ontario Securities Commission to sell up to 80 million Canadian dollars ($58.4 million) worth of company shares over 25 months ^[1].

Matador CEO Deven Soni said the firm is "focused on increasing Bitcoin per share over time" and would "continue to target a treasury balance of 1,000 Bitcoin by the end of 2026" ^[1]. The company, which became a Bitcoin treasury company on December 23, 2024, bought 175 BTC in its first year ^[1].

In July, Matador said it plans to expand its targeted 1,000 BTC holdings by 2026 to 6,000 BTC before the end of 2027 ^[1]. Its ultimate goal is to obtain 1% of Bitcoin's fixed supply, approximately 210,000 BTC—an amount only Michael Saylor's Strategy has accumulated to date ^[1].

BlackRock Maintains Bitcoin ETF as Major Investment Theme

Despite current market conditions, BlackRock has highlighted its spot Bitcoin ETF as one of its three biggest investment themes in 2025, alongside Treasury bills and the largest US tech stocks ^[2]. Bloomberg ETF analyst Eric Balchunas noted that IBIT saw $25 billion in year-to-date flows even while posting a negative return for the year ^[2].