After weeks of steady withdrawals, investors are starting to allocate fresh capital to US spot bitcoin exchange-traded funds (ETFs).
The change comes after a difficult start to the year for products. From mid-October, when the price of bitcoin began to fall, through the end of February, spot bitcoin ETFs saw cumulative outflows of around $9 billion, according to data from Bloomberg Intelligence ETF analyst James Seyffart. The category still shows $1.1 billion in net outflows by 2026, but flows have changed in recent days. Since February 24, investors have added approximately $1.7 billion.
The bounce suggests that some investors believe Bitcoin may have found at least a short-term bottom.
“I was surprised that there was basically no dip buying when bitcoin was a falling knife at the beginning of the year,” Seyffart said. At the time, software stocks and crypto assets were falling, but investor behavior was divided. Software ETFs generated record inflows as traders tried to time a fund, while bitcoin ETFs continued to see steady withdrawals.
Those retreats were not dramatic, but they persisted.
Now the pattern appears to be reversing. Seyffart said the recent price action may have helped restore confidence. Over the weekend, bitcoin remained above its recent lows despite geopolitical tensions linked to Iran.
“I think investors probably feel a little more comfortable that we’ve hit at least a bottom in the near term,” Seyffart said. “That higher low this weekend with such massive news had to be a comfort to some.”
The entries also appear to reflect overtly bullish positioning rather than market-neutral trading strategies. Some institutional investors use ETFs and futures together in what is known as basis trading, where they earn returns from price differences between the spot and futures markets.
But that setup doesn’t look appealing right now.
Returns tied to those trades remain relatively low, while open interest in the CME crypto futures and options markets has declined. That drop suggests that fewer traders are taking on the large positions in derivatives that typically accompany arbitrage strategies.
Instead, ETF entries look more like direct bets on the direction of bitcoin’s price.
Even though Bitcoin fell about 16% this year, almost all Bitcoin spot ETFs are still showing positive net flows by 2026, and BlackRock’s iShares Bitcoin Trust (IBIT) has added roughly $300 million in capital so far this year. That dynamic highlights how investors continue to allocate funds through regulated fund structures even during crises.
Nate Geraci, president of ETF Store, said the flows also reflect growing conviction among large asset managers who promote the funds.
“It’s easy to frame this as BlackRock simply promoting its highest-revenue product,” Geraci said. “But I see it more as a company doubling down on its belief that bitcoin belongs in diversified portfolios.”
Geraci noted that BlackRock has many ETFs with higher fees that it could highlight. Meanwhile, its spot bitcoin ETF, IBIT, is down about 4% this year. Asset managers rarely highlight lagging funds unless they believe strongly in the long term, he said.
