U.S. spot Bitcoin ETFs experienced significant outflows of $410.4 million on Thursday, marking the sixth negative trading day in the past ten days as institutional conviction wavers amid a volatile macro environment.
BlackRock’s IBIT led the exodus with $157.6 million in outflows, followed by Fidelity’s FBTC at $104.1 million and Grayscale’s GBTC at $59.1 million. The bleeding extends a troubling two-week stretch that has seen these products shed nearly $1.5 billion.
The erratic flow pattern reveals deepening institutional uncertainty, even as Bitcoin remains a cornerstone of portfolio diversification strategies. Analysts told Decrypt that retail traders are left navigating a directionless market despite significant daily trading volume. The broader sentiment has shifted dramatically, with the Fear and Greed index hitting extreme fear levels unseen since 2023.
Christophe Diserens, chief wealth officer at SwissBorg, attributed the volatility to conflicting signals in the macro backdrop. “Kevin’s Fed nomination has lowered near-term rate cut expectations, sparking rapid repricing in equities, bonds, and crypto,” Diserens told Decrypt. “Meanwhile, negative momentum is being fueled by ongoing bear market narratives on social media.”
Yet long-term optimism hasn’t disappeared entirely. JPMorgan projects a $266,000 Bitcoin target, and adoption metrics continue to expand across the ecosystem. This tension between short-term panic and long-term conviction is driving the volatility in daily ETF flows, according to analysts tracking the space.
Nick Motz, CEO of ORQO Group and CIO of Soil, described the situation as a structural tug-of-war. “You’ve got institutions that got in late 2025 now taking profits, and on the other side, there’s a messy short-covering cycle playing out in real time,” he said.
Bitcoin currently hovers around the $67,000 range (near where mining production costs sit), and institutional algorithms are executing automated liquidations tied to hawkish Federal Reserve expectations.
Capital isn’t necessarily fleeing crypto entirely. Instead, Motz noted that institutional money is shifting into more compliant derivatives channels like the CME. “It’s shifting into more compliant derivatives channels like the CME,” he explained. “That results in a choppy, directionless tape that honestly looks broken to most retail traders.”
Motz referred to the current market conditions as a “liquidity mirage,” where there is activity everywhere but no real directional conviction. This dynamic is damaging retail sentiment significantly. The global M2 money supply growth has flatlined, and high-yield credit spreads are creeping wider
Motz expects volatility to persist through at least the first half of 2026, with “head-fake rallies” trapping late buyers before the next leg down. “The market probably doesn’t find a real floor until credit markets finish repricing risk, which honestly could take us into summer,” he said. The analyst warned that those expecting a near-term resolution should manage expectations accordingly.
Standard Chartered’s digital asset research head, Geoff Kendrick, offered a longer-term perspective, forecasting that Bitcoin will dip to $50,000 before recovering to $100,000 by year-end 2026, while Ethereum falls to $1,400 before rebounding to $4,000. Kendrick noted that current market challenges may actually signal that digital assets are maturing and becoming more resilient.
Bitcoin currently trades around $67,365, down 1.17% over the past 24 hours. The asset has been range-bound between $62,000 and $71,000 since early February with no sustained breakout. On prediction market Myriad, users are placing a 61% probability on Bitcoin’s next move, taking it to $55,000 rather than $84,000.
The near-term outlook remains murky as macro headwinds continue pressuring risk assets. Coinbase’s fourth-quarter results underscored the sector’s struggles, with the exchange reporting $1.78 billion in revenue (a 22% decline year-over-year) and below analyst expectations of $1.84 billion. The company posted a $667 million net loss for Q4, reversing $1.3 billion in profits from the prior year.
For now, crypto market traders should prepare for continued volatility and sideways price action through the first half of 2026. The structural repricing of risk in credit markets will likely dictate the tone until credit conditions stabilize and liquidity conditions improve.
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