Demand for U.S.-listed spot Bitcoin exchange-traded funds (ETFs) has sharply reversed, with the 12 products recording $1.6 billion in net withdrawals in January 2026. This marks the third consecutive month of negative flows, representing the longest streak of losses since the SEC authorized the products in January 2024. Over this three-month period, the funds have lost approximately $6 billion in total flows.
Data from SoSoValue and CryptoQuant corroborates the significant shift in investor sentiment. Year-to-date, the 12 Bitcoin funds have collectively experienced an exodus of approximately 4,595 BTC. This starkly contrasts with the record inflows of previous years, which saw +39,769 BTC in 2025 and +17,155 BTC in 2024 during the same periods.
Market observers attribute the exodus to "narrative exhaustion" coinciding with Bitcoin's lackluster price performance. Since reaching an all-time high of over $126,000 in October 2025, BTC's price has declined by more than 37%. Jim Bianco, founder of Bianco Research, suggested the period of rapid institutional adoption has reached its logical conclusion. "Markets are discounting mechanisms. They price the narrative long before the event occurs," Bianco stated, characterizing the late-2025 rally as a "zombie rally" driven by residual momentum rather than fresh capital.
The trend accelerated amid a partial U.S. government shutdown, which pushed investors into a risk-off mood. On the last trading day before the weekend, spot Bitcoin ETFs alone saw $509.7 million in outflows. BlackRock's IBIT, typically a magnet for institutional demand, recorded the largest single outflow of $528.3 million. Concurrently, Bitcoin's price fell 5.1% to around $78,734.
The outflow was even more pronounced for Ethereum ETFs, which saw a combined $252.9 million exit. BlackRock's ETHA lost $157.2 million and Fidelity's FETH saw $95.7 million in withdrawals as Ethereum's price dropped over 8% to around $2,421. Solana was also hit hard, with $11.3 million in ETF outflows as its price fell nearly 10% to $105.36. Ripple's XRP was a notable exception, attracting $16.79 million in net inflows despite a 2.21% price slip, suggesting some investors are separating its long-term regulatory outlook from current uncertainty.
Amid the sell-off, Bitwise took a quiet step toward future product expansion by registering a Uniswap (UNI) ETF trust in Delaware, indicating the race for altcoin ETF applications continues despite short-term market pressure.
