Bitcoin ETF outflows surge as Treasury yields lift rate-cut fears
Crypto ETPs recorded $1.47B of outflows last week, extending redemptions for a second straight week, according to CoinShares. Bitcoin ETF outflows were the main driver: spot BTC funds saw $1.32B outflows, including $1.26B from the 11 U.S.-listed spot Bitcoin ETFs. Ether (ETH) funds lost $223M.
Across the broader ETP complex, altcoin ETF flows also weakened. Two-week cumulative outflows reached $2.54B, with CoinShares tying the move to broader risk-off sentiment even as the CLARITY Act progressed.
For crypto traders, the key macro link is shifting U.S. rates pricing under new Fed Chair Kevin Warsh. Markets increased bets that policy will stay restrictive, with the 2-year/10-year Treasury yield spread rising by more than 12 bps last week—typically a headwind for risk assets. Traders will likely focus next on U.S. inflation data, including core PCE, to reassess the rate path. Bitcoin ETF outflows remain a near-term barometer for sentiment.
Bearish
Bitcoin ETF outflows signal sustained risk-off positioning and have direct flow pressure on the BTC complex. With spot Bitcoin ETF redemptions leading the $1.47B outflows, BTC-related sentiment likely stays fragile in the near term. The macro driver reinforces that risk: Treasury yield spreads widened as traders priced a more restrictive policy stance under the new Fed Chair, which tends to increase funding/borrowing costs and pressure high-volatility assets. Even though some altcoin products can see inflows, the broader ETP complex outflows (including $2.54B over two weeks) suggest aggregate demand is weakening. Expect potential continued volatility until next U.S. inflation (core PCE) data clarifies whether rate-cut hopes revive or yields stay elevated.