After a prolonged series of sell-offs, the situation has finally changed. The week ending July 10 brought net inflows to spot ETFs for Bitcoin and Ethereum, something that had not happened for eight consecutive weeks.
According to SoSoValue, net inflows into Bitcoin ETFs totaled $197.4 million, while Ethereum ETFs attracted another $84.42 million. Until then, capital had been leaving these instruments almost nonstop since mid-May.
Inflows to Bitcoin ETFs. Source: SoSoValue
Investors Are Returning to ETFs
For Bitcoin funds, this is the first successful week since mid-May. The largest outflow occurred at the end of June, when investors withdrew about $1.79 billion in just one week.
Ethereum ETFs experienced a similar situation. Their largest weekly outflow also occurred in the period ending June 26, reaching $273.34 million.
Now the picture looks different. By July 10, the net assets of Bitcoin ETFs had increased to $77.42 billion, while Ethereum funds recovered to $9.59 billion.
See Also: Outflows from Gold ETFs Reached $8.9 Billion in June
The turnaround started even earlier. As early as July 2, Bitcoin ETFs attracted $221.72 million, ending a streak of ten consecutive trading sessions with outflows.
The Market Is Watching More Than Just ETFs
The return of buyers coincided with a recovery in the Bitcoin price. One of the reasons was statements by Fed Chair Kevin Warsh, who noted a decrease in inflation risks. Additional support for the market came from weaker-than-expected employment data in the U.S..
However, it is too early to talk about a stable trend. On July 8, Bitcoin ETFs saw outflows of $84.86 million, and a day later, outflows increased to $95.3 million. This happened against the backdrop of U.S. strikes on Iranian territory.
The market is now closely watching two topics. The first is further decisions by the Fed. The second is the development of the conflict in the Middle East.
Donald Trump stated that Washington and Tehran intend to continue negotiations. At the same time, he emphasized that the ceasefire announced by both sides a month ago is no longer in effect.
Any new escalation could quickly affect cryptocurrencies. For now, investors are assessing not only capital flows into ETFs, but also political events that could change the situation in global markets.
