- Bitcoin and Ethereum ETFs move back to net inflows after several days of redemptions, with late December trading shaped by tax decisions and low liquidity.
- The article explains how ETF flow data connects to spot prices over time, and how past patterns suggest short term moves after strong inflows or outflows.
On 30 December, Bitcoin and Ethereum ETFs finally broke a long stretch of daily redemptions. They closed the session with clear net inflows, even while Bitcoin traded below 90,000 dollars and Ethereum under 3,000. The shift arrived only days before year end, in a market still shaped by holiday liquidity and tax planning.
Inflows return to Bitcoin and Ethereum ETFs after mid December redemptions
The first clear change appeared in Bitcoin products. On 30 December, US spot Bitcoin ETFs recorded about 354.8 million dollars in net inflows. That single day ended a seven day outflow streak that had reduced holdings and signalled caution among larger investors. Ethereum products also turned higher, posting 67.8 million dollars in net inflows on the same date. That move lifted sentiment toward Bitcoin and Ethereum ETFs. Those gains did not erase the difficult spell earlier in the month. Between 15 and 19 December, combined withdrawals from both assets reached roughly 1.13 billion dollars. During that window, Bitcoin ETFs lost 751 million dollars, while Ethereum products saw 564 million dollars leave the sector. Institutions cut risk, adjusted balance sheets and harvested tax losses as liquidity stayed shallow. Signs of that de risking remained visible right up to the turn in flows. On 29 December, Bitcoin funds still registered 19.3 million dollars in redemptions and Ethereum ETFs shed another 9.6 million dollars. Large issuers such as BlackRock’s IBIT and ETHA drove a significant share of those moves. The tone changed on the next trading day. Inflows into Bitcoin and Ethereum ETFs suggested that some investors saw value or wanted early exposure before January.
Market drivers behind renewed demand for Bitcoin and Ethereum ETFs
Several forces likely sit behind the late December demand for Bitcoin and Ethereum ETFs. Some investors saw the earlier price weakness and heavy redemptions as an opportunity to re enter at lower levels. Others positioned for a possible January effect. In many years, risk assets stabilise once tax motivated selling and year end window dressing fade from the tape. With trading volumes thin, even a moderate wave of new orders can stand out in the daily flow data. Institutional desks also rely on these vehicles as straightforward tools to adjust exposure without moving coins on chain. That role became clearer during 2025, when inflows into Bitcoin ETFs absorbed 5.2 percent of the annual Bitcoin supply increase. In weeks with better sentiment, that steady demand supported rallies by removing new coins from the freely trading float. The latest move into Bitcoin and Ethereum ETFs does not yet match those earlier peaks. It shows that large allocators still use the structure to manage entries and exits after a volatile month.
Historical link between flows, prices and Bitcoin and Ethereum ETFs
Research over recent years underlines the close link between ETF flows and spot market behaviour. Statistical work on Ethereum vehicles finds a correlation coefficient of about 0.79 between daily Ethereum ETF flows and price changes. The result points to efficient price discovery through these listed products rather than a detached secondary market. When inflows surprise to the upside, issuers must buy coins in the open market. The additional demand often pushes prices higher in the following sessions. Event studies around the launch of the first US spot Bitcoin ETFs in early 2024 show similar patterns. Spot returns in Bitcoin, Ethereum and even assets such as Litecoin tended to improve around those key dates. Researchers also found that unexpected surges in ETF buying often led to sustained price gains. Peaks usually arrived three to four days after the initial flow shock. Outflows showed the opposite effect. When redemptions forced issuers to sell holdings, short term drawdowns became sharper and intraday moves less stable. This effect was clear in mid December 2025, when Bitcoin and Ethereum ETFs saw large and persistent withdrawals. Sideways trading that followed the December outflows fits that pattern. The current shift to inflows may again prepare the ground for a later recovery if demand continues.
Altcoin Rotation and What It Signals for Major Crypto Funds
Flows into the largest pairs are only part of the picture. Products linked to major altcoins such as Solana and XRP kept drawing net inflows through late December. That trend continued even when Bitcoin and Ethereum ETFs reported net redemptions. That split hinted at a rotation inside the listed digital asset universe. Some allocators trimmed the biggest names and searched for more targeted bets in smaller and faster moving networks. The renewed buying in Bitcoin and Ethereum ETFs now sits beside that ongoing trend. On one side, the move shows that the core pair still anchors many institutional portfolios. Many investors want liquid access and clear reporting through an exchange traded wrapper. On the other side, the resilience of altcoin ETFs points to growing diversification inside the segment. If inflows into both the large cap funds and the smaller cap products carry into January, the listed fund space may start the new year with a broader base of demand. That base would likely exceed the levels seen during the stressed weeks of December.
Conclusion
The latest flow data for Bitcoin and Ethereum ETFs marks a distinct break from the heavy redemptions that dominated mid December. Those earlier days pushed combined withdrawals to about 1.13 billion dollars in only a few sessions. A single day of 354.8 million dollars of new Bitcoin ETF demand alongside 67.8 million dollars for Ethereum cannot guarantee a lasting shift. It does confirm that investors still rely on these structures to express views and manage risk. Earlier episodes suggest that if inflows persist, issuers will keep buying coins in the market. That pattern can support spot prices over the following three to four days. At the same time, continued interest in Solana and XRP funds shows that competition for capital inside the sector remains active. The strength and duration of this new phase in flows will decide the outcome. The late December turn in Bitcoin and Ethereum ETFs may become the start of a broader recovery or simply a brief pause in a longer period of consolidation.
Disclaimer
The information provided in this article is for informational purposes only and should not be considered financial advice. The article does not offer sufficient information to make investment decisions, nor does it constitute an offer, recommendation, or solicitation to buy or sell any financial instrument. The content is opinion of the author and does not reflect any view or suggestion or any kind of advise from CryptoNewsBytes.com. The author declares he does not hold any of the above mentioned tokens or received any incentive from any company.
Featured image created by AI
