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US spot Bitcoin exchange-traded money (ETF) regular flows aren’t reliable guides to BTC’s adjacent determination arsenic investors thin to pursuit rallies and merchantability into slumps, according to DWF Labs.
In a probe study published Thursday, DWF recovered that investors pulled wealth from the funds during 7 of the 8 times Bitcoin’s terms dropped astatine slightest 15%. All 9 rallies of that size drew nett inflows. The investigation reviewed 694 trading days dating backmost to January 2024, erstwhile Bitcoin ETFs archetypal launched successful the US.
“ETF flows corroborate moves; they don’t foretell them,” DWF said successful its report. “The grounds points mostly to investors reacting to price, not driving it.”
Investors tended to enactment wealth into Bitcoin ETFs aft prices roseate and propulsion it retired aft prices fell. Those flows offered astir nary hint to whether Bitcoin would emergence oregon autumn implicit the adjacent 5 days.
Each day’s ETF flows had a mean narration with Bitcoin’s terms changes implicit the 5 trading sessions earlier that day, with a correlation of 0.54. On a standard wherever zero means nary relationship, the correlation for the pursuing 5 days was 0.03.
ETF outflows successful 7 of 8 Bitcoin sell-offs. Source: DWF Labs
ETF outflows don’t amusement who sold
The heaviest withdrawals came during the 2 astir caller sell-offs. Investors withdrew a nett $6.9 cardinal betwixt October 2025 and February 2026, followed by $8.2 cardinal during the May–June decline.
The figures bash not amusement whether institutions oregon retail investors drove the selling. DWF did not abstracted the 2 groups successful its analysis.
“We don’t person a wide divided connected the nonstop buyers/sellers of the ETFs,” a DWF Labs spokesperson told Cointelegraph.
Related: Institutions held crypto done 50% drawdown, Bitwise finds
Some ETF enactment besides comes from investors buying money shares portion betting against Bitcoin done CME futures to gain the terms spread betwixt the 2 positions. DWF estimated that astir a 5th of flows whitethorn person been hedged this way, though its information could not corroborate that the aforesaid investors held some sides of the trades.
A CoinShares investigation published successful June recovered that nonrecreational investors reduced their Bitcoin ETF vulnerability by 17% successful the archetypal 4th of 2026. Hedge funds and brokerages accounted for astir 96% of the reduction, portion banks accrued their holdings.
Bitcoin’s sell-offs person slowed
Bitcoin has had astir 3 sell-offs of 15% oregon much a twelvemonth since the ETFs launched, compared with astir 4 a twelvemonth successful 2022–2023 and 8 successful 2021, the study found.
The declines person besides go much gradual, but the losses are inactive comparable. The median sell-off wiped retired 21.3%, against 19.4% successful 2022–2023.
“The changes aren’t solely owed to the ETF,” the spokesperson said, noting that volatility and the frequence of sell-offs were already declining earlier the funds launched successful 2024.
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