Bitcoin ETF selling cools as $500M inflows hint institutional pressure is fading

Net inflows of more than $500 million over the past three trading sessions are fueling expectations that institutional selling tied to spot Bitcoin ETFs is losing steam. Swissblock says Bitcoin is showing early signs of recovery after one of the year's largest waves of spot ETF selling. The firm characterized the recent drawdown as the "most overwhelming ETF distribution wave of this bear market" and argues the worst of the selloff likely has passed. It also said Bitcoin's risk profile has eased from what it calls "Capitulation Risk," while spot Bitcoin ETF flows have started to turn slightly positive again. The shift follows a prolonged stretch of outflows from U.S. spot Bitcoin ETFs. Starting June 17, the funds posted ten straight trading days of net withdrawals totaling about $2.7 billion. Sentiment improved afterward, with the group logging more than $500 million in combined net inflows across the next three sessions. Wednesday briefly broke the streak with a comparatively small $84.9 million net outflow, but Swissblock says the broader pattern still points to weakening institutional selling pressure. Even so, Swissblock urged caution. The firm called the inflows encouraging, but said institutional conviction has not fully returned. In its view, panic selling has eased, yet it's still too early to declare the start of a durable bullish trend. It also raised the possibility that Bitcoin may be passing through the "eye of the storm" rather than clearing the volatility outright. CryptoQuant echoed the guarded tone. Research contributor IT Tech noted a meaningful rebound in overall Bitcoin demand over the past week, with 30-day cumulative demand improving from nearly negative 500,000 BTC to around negative 75,000 BTC. Despite the gain, demand remains below positive territory. CryptoQuant data suggests derivatives-led activity is recovering faster than spot buying. Futures demand rebounded from roughly negative 295,000 BTC to slightly positive levels, while spot market demand is still negative. That gap may indicate investors buying Bitcoin outright remain more cautious than traders using derivatives. For now, improving ETF flows alongside a recovery in futures demand point to healthier market conditions than those seen just a few weeks ago.