Glassnode Flags Bearish Shift in Bitcoin & Ethereum ETFs — Institutional Appetite Fades
The recent pullback in Bitcoin (BTC), Ethereum (ETH), and the broader altcoin market is now spilling over into ETFs. On-chain analytics firm Glassnode reports that outflows from both BTC and ETH ETFs have persisted for several weeks, signaling a clear cooling in institutional demand.
According to Glassnode, these sustained ETF outflows suggest that institutional investors are reducing exposure, entering a phase of low participation and partial exit. This behavior aligns with a broader trend of liquidity tightening across the crypto market.
Glassnode notes that prolonged negative flows in Bitcoin and Ethereum ETFs typically point to weakening institutional involvement and a transition into a lower-volume market environment. Since ETFs are widely viewed as one of the most reliable gauges of institutional sentiment, declining inflows can hurt market depth and trading activity—often resulting in higher short-term volatility.
Analysts also highlight that BTC and ETH ETFs were key drivers of the 2025 rally, making the current shift especially notable. In today’s market conditions, institutional sentiment appears to have tilted from bullish to bearish.
That said, uncertainty remains over whether this sell-off marks the start of a prolonged bear market or merely a temporary risk-off phase. Many analysts lean toward the latter, emphasizing that long-term fundamentals remain intact.
Glassnode adds that despite low liquidity, muted risk appetite, and short-term bearish pressure, large investors have not abandoned their long-term positions. As a result, while near-term conditions look challenging, the broader long-term outlook for crypto remains constructive.
