Bitcoin Faces $1 Billion ETF Outflows and Weak On-Chain Signals in Volatile Week

• Bitcoin ETFs face longest outflow streak since April tariff fears.
• Glassnode shows fragile momentum as the market drops from $117k to $111k.
• On-chain and futures data reflect weaker conviction and rising caution.

Santiment reported that US-listed Bitcoin ETFs are on their sixth straight day of net outflows, marking the longest negative streak since early April when tariff fears gripped markets.

At that time, similar withdrawals signaled uncertainty but later paved the way for a rebound. Santiment noted that current outflows increasingly appear retail-driven rather than dominated by institutions as seen earlier in the cycle.

Source: Santiment

Retail traders tend to react emotionally when they assume prices have peaked, often pulling money from ETFs at the first sign of weakness. Such collective exits can drag markets lower in the short term.

However, past cycles, including the April downturn, show that these retail-driven retreats often align with temporary bottoms, offering opportunities for stabilization once selling pressure eases.

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Bitcoin Faces Volatile Swings Amid Weak Spot Momentum

According to Glassnode, Bitcoin had broad fluctuations last week when it went up to $117,000 but then dipped to $111,000. Spot market momentum suffered when the Relative Strength Index moved into oversold territory, a signal that sellers were increasing pressure.

Trading volumes remained unchanged but failed to muster the punch to suggest new buying interest, reflecting fragile belief from participants.

In derivatives, futures open interest fell, a signal of decreasing leverage, while funding payments rose as longer-term traders tried to maintain positions.

Even though net positioning was slightly better, to ease near-term selling pressure, risk appetite is diminishing. Options information added to the prudent tone.

Open interest rose slightly, but volatility spreads declined, indicative of complacency. Meanwhile, the 25-delta skew went into the positive, a clear indicator that traders were paying premiums for downside protection should prices continue to fall.

Bitcoin ETF Outflows Signal Weakening Market Demand

ETF flows presented a bearish scenario with a sharp $1.0 billion outflow during the week. Volumes eased and MVRV ratios declined, a sign of pressure building on profitable holders and losing momentum from traditional finance investors who had fueled massive inflows earlier.

Source: Glassnode

On-chain demand also softened. Daily active addresses fell, and the fee per transaction declined to reflect declining organic activity. Transfer amounts rose instead due to reallocations due to volatility.

The indicators of capital flows confirmed the cooling trend, and Realized Cap flows slowed down, and Hot Capital Share stabilized at its ceiling.

The short-term to longer-term supply/ratio increase was slight and showed moderate rotation but little conviction by the longer-term investors. Overall, these changes reflect the market easing back from euphoria to vulnerability, with caution dominating sentiment.

Also Read: Bitcoin Targets $120,000 as Metaplanet Expands Holdings Despite Price Dip