The demand for Bitcoin and cryptocurrency-related investment funds is waning, as evidenced by the recent report detailing $866 million in net outflows from US spot Bitcoin exchange-traded funds (ETFs) on Thursday. This marked the second-largest daily outflow on record, following a previous high of $1.14 billion on February 25, 2025, according to data from Farside Investors.
This decline in ETF demand comes despite the conclusion of a prolonged 43-day US government shutdown, which many had hoped would revitalize investor interest. The recent outflows occurred immediately after President Donald Trump signed a government funding bill that will sustain federal operations until January 30, 2026.
The market”s current conditions are causing unease among crypto investors, particularly since Bitcoin ETFs were pivotal in driving the asset”s momentum throughout 2025, alongside notable strategies from figures like Michael Saylor. Nevertheless, analysts suggest that the bullish trend for Bitcoin remains intact as long as prices stay above the critical threshold of $94,000, which corresponds to the average cost basis for investors who acquired Bitcoin in the last six to twelve months.
Ki Young Ju, founder and CEO of the crypto analytics firm CryptoQuant, expressed that the onset of a bear market cannot be confirmed unless this key level is breached. “Personally, I do not think the bear cycle is confirmed unless we lose that level. I would rather wait than jump to conclusions,” Ju stated in a post on X.
In contrast, some market observers argue that traditional theories, such as the four-year cycle, may no longer apply due to the introduction of Bitcoin ETFs and the changing political landscape in the US. Hunter Horsley, CEO of Bitwise Asset Management, remarked in a recent X post that since the launch of Bitcoin ETFs, a new market structure has emerged. He emphasized that the current setup for cryptocurrencies is stronger than ever.
Despite the outflows from Bitcoin ETFs, there are signs of underlying demand in the cryptocurrency sector. The recent launch of the Canary Capital XRP (XRPC) ETF, which is the first US-based ETF to hold spot XRP tokens, has generated significant interest. The XRP ETF debuted with impressive volume, surpassing all other crypto and traditional ETF launches of 2025, indicating a robust appetite for regulated altcoin funds. Bloomberg ETF analyst Eric Balchunas noted the strong performance of the XRP ETF, which achieved $58 million in volume on its first day.
In addition to the XRP ETF”s success, the performance of other crypto funds varies. While Ether (ETH) ETFs recorded $259 million in outflows on Thursday, Solana (SOL) ETFs managed to attract $1.5 million in inflows, continuing their positive trajectory over the past 13 days.
