Analysts Call Bitcoin ETF Outflows a Capital Rotation

• Between May 18 and May 22, products tied to the leading cryptocurrency recorded $1.26 billion in outflows.
• Experts said institutional demand has not disappeared but has instead shifted into other products.

Outflows from Bitcoin ETFs do not indicate that institutional investors are exiting the market. That was stated by BRN head of research Timothy Misir, according to The Block.

“Institutional demand hasn’t disappeared — it has rotated,” he said.

According to BRN, Bitcoin remains below $78,000 amid spot ETF outflows, geopolitical tensions, and weaker trading activity caused by public holidays in the U.S. and Europe. Analysts also highlighted that spot Bitcoin ETFs recorded $1.26 billion in outflows between May 18 and May 22.

At the same time, the altcoin ETF segment attracted fresh capital. Analysts believe this dynamic points to capital reallocation between instruments rather than a complete exit from the crypto market.

Ethereum Faces Pressure

The statement also noted that Ethereum declined after the U.S. Securities and Exchange Commission (SEC) delayed consideration of plans related to trading tokenized equities. Laser Digital said this became one of the key factors pressuring the asset over the weekend.

A partial recovery followed on Sunday. Analysts linked the rebound to reports of a possible agreement between the United States and Iran, which improved market risk appetite.

In the options market, volatility for both Bitcoin and Ethereum continued to decline, while the spot market remained trapped within roughly a 1% range. Laser Digital added that the skew toward put options remains significant and is likely to persist.

Ahead of the May 29 expiration, the largest open interest in Bitcoin is concentrated around the $75,000 put option and the $80,000 call option. For Ethereum, the strongest interest has formed near the $2,100 put option.

Put options generally reflect expectations of price declines, while call options typically signal expectations of further upside.

Macroeconomic Background

Senior analyst Kyle Rodda from Capital.com warned about the risk of price gaps when markets reopen. According to him, public holidays in the U.S. and Europe reduced liquidity, which could increase volatility.

He noted that a potential agreement between the United States and Iran could trigger a sharp decline in oil prices. At the same time, equity indices could move toward new highs as inflation risks are reassessed.

However, Rodda emphasized that such a scenario is far from guaranteed. Unresolved issues still include Iran’s nuclear program, uranium enrichment, and control over the Strait of Hormuz.

Earlier, CryptoQuant stated that Bitcoin demand had fallen to its most bearish level of 2026.

See also: "BitMEX Analysts Predict a New Phase of Bitcoin Growth"

#Bitcoin (BTC) #ETF #outflows

Share: