Bitcoin ETF Outflows Highlight Waning Risk Appetite in 2026

By: Eva Baxter

The first week of 2026 witnessed significant outflows from Spot Bitcoin exchange-traded funds (ETFs), with investors reacting to global economic uncertainties and geopolitical tensions. Data indicates that these ETFs experienced a withdrawal of $681 million in total. The sharp reversal of funds over the initial trading days of the year highlights a shift towards risk-off investment strategies, as investors anticipate continued market volatility and are wary of upcoming economic policies.

Spot Bitcoin ETFs, which started the year strong with inflows signaling some early investor confidence, saw a notable shift as outflows were recorded consistently from Tuesday through Friday. According to SoSoValue data, there was a stark $486 million redemption on Wednesday, followed by $398.9 million on Thursday, and another $249.9 million on Friday. This pattern of outflows suggests a broader trend of tactical de-risking among investors who appear to be revisiting their appetite for risks.

The initial inflows of $471.1 million on January 2 and subsequent $697.2 million on January 5 were quickly overshadowed by outflows, underscoring the fragility of investor sentiment in the current climate. On the backdrop of geopolitical concerns and unsurety surrounding global monetary policies, investors seem to be in a cautious wait-and-see mode. Analysts believe that the retraction could also be attributed to dwindling hopes for imminent Federal Reserve rate cuts, further dimming the allure of high-risk investment vehicles like Bitcoin ETFs.

This retreat into safer assets may reflect investor anticipations for a turbulent year, as economic and political hurdles continue to shape the investment landscape. As markets brace for possible future developments, the dynamics in the crypto investment sphere will likely offer further insights into investor behavior amidst prevailing economic conditions.