Introduction
Bitcoin exchange-traded funds attracted $352 million last week, driving nearly half of all crypto fund inflows as investor sentiment shows tentative signs of recovery. Meanwhile, short-Bitcoin products experienced their largest outflows since March 2025, suggesting a potential bottom for negative market sentiment. Total crypto assets under management have rebounded 7.9% from November lows to $180 billion, though they remain significantly below record highs, according to data from digital assets manager CoinShares.
Key Points
- Short-Bitcoin products saw $18.7 million in outflows—the largest since March 2025—hinting at a possible sentiment reversal.
- XRP funds attracted $244 million in inflows, surpassing Ethereum, partly due to a new leveraged ETF launch.
- Total crypto assets under management have recovered 7.9% from November lows to $180 billion but remain 32% below the $264 billion peak.
Bitcoin ETFs Dominate as Short Interest Collapses
The crypto investment landscape witnessed a notable shift last week, with Bitcoin ETFs pulling in $352 million in fresh capital. This substantial figure represented approximately half of the total $716 million that flowed into crypto investment products globally, underscoring Bitcoin’s continued dominance as the primary gateway for institutional and retail investors. The inflows occurred alongside a significant retreat from bearish positions: short-Bitcoin products saw outflows of $18.7 million, marking the largest weekly withdrawal since March 2025.
James Butterfill, CoinShares’ head of research, linked this movement to a potential sentiment shift. “At that time, outflows coincided with a similar price low,” Butterfill wrote, referring to the March 2025 data. “This suggests that ETP investors believe the current bout of negative sentiment may now have reached its bottom.” This parallel indicates that sophisticated investors using exchange-traded products are interpreting the mass exit from short positions as a contrarian signal, potentially foreshadowing a price floor. At the time of the report, Bitcoin was trading at $90,259, having gained 6.6% over the preceding week.
XRP Emerges as Surprise Runner-Up, Ethereum Takes Back Seat
In a departure from recent trends, the runner-up for inflows was not Ethereum but XRP. Fresh XRP funds attracted a substantial $244 million, vastly surpassing the $39 million that flowed into Ethereum products. This surge is no coincidence, as it directly followed the launch of a new leveraged XRP ETF last week, demonstrating how product innovation can rapidly redirect capital within the digital asset ecosystem. The significant allocation to XRP funds highlights a diversification of interest beyond the two largest cryptocurrencies, with investors potentially seeking alternative opportunities or responding to specific regulatory or product developments surrounding the asset.
Ethereum’s relatively modest $39 million inflow, while positive, underscores that investor appetite remains cautiously selective. The data from CoinShares reveals a market where capital is not flooding back uniformly but is being deployed strategically, with Bitcoin capturing the lion’s share of renewed confidence and new, niche products like the XRP ETF creating targeted excitement. This breakdown challenges the simple Bitcoin-Ethereum duopoly narrative and points to a more complex and maturing fund market.
Macroeconomic Headwinds and the Path to $180 Billion AUM
The broader picture for crypto assets under management (AUM) shows a recovery facing macroeconomic crosscurrents. Total global AUM for crypto investment products has risen by 7.9% from its November lows to reach $180 billion. However, this figure remains well below the all-time high of $264 billion, a gap of nearly 32%. Butterfill noted that daily data revealed “minor outflows on Thursday and Friday in what we believe was a response to macroeconomic data in the U.S. alluding to ongoing inflationary pressures.”
That data came from the Bureau of Labor Statistics, which released Personal Consumption Expenditures (PCE) figures for September—the Federal Reserve’s preferred inflation gauge. The report showed inflation rose 2.8% year-over-year, a figure lower than forecasts and a slight cooldown from August’s 2.9% reading. Despite this modest deceleration, the persistence of inflationary pressures continues to influence investor behavior. Nevertheless, market participants on prediction market platform Myriad see a high probability of monetary policy support, with a 94% chance priced in for the Federal Open Market Committee to announce another 25 basis point interest rate cut. This anticipated action from the Federal Reserve may be providing a backdrop of optimism, helping crypto funds attract capital despite lingering economic uncertainties.
📎 Related coverage from: decrypt.co